The Members of
UNIPHOS ENTERPRISES LIMITED
Your Directors have pleasure in presenting their report and audited accounts for theyear ended 31st March 2020.
| || ||(Rs. in lakhs) |
| ||Year ended 31st March 2020 ||Year ended 31st March 2019 |
|Profit before taxation ||2042.70 ||2118.46 |
|Less: Provision for taxation ||35.26 ||42.00 |
|Profit after taxation ||2007.44 ||2076.46 |
|Add: Balance brought forward ||7759.86 ||5683.40 |
|Balance carried forward ||9767.30 ||7759.86 |
During the year the Company traded in chemical of Ethylenediamine totaling to '22.68lakhs. Other income was '2341.81 lakhs as compared to '2403.49 lakhs in the previous year.
The Company has earned profit of '2007.44 lakhs after tax as compared to profit of'2076.46 lakhs in the previous year.
The Company is engaged only in trading in chemicals. Though Company had some sales evenduring lockdown the Company's revenue is mainly from other income consisting of dividendon equity shares and interest on loans. the revenue of the Company is not likely to beimpacted by COVID-19 pandemic. However the financial assets of the Company are mainlyinvestments in listed securities and accordingly any material volatility in the capitalmarket may impact the market value of the investment.
The Company continues to look at new opportunities of trading in chemicals in India.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report forms an integral part of this Report.
Your Directors do not recommend any dividend for the year under review.
TRANSFER TO RESERVES
No amount is appropriated from Profit and Loss Account and transferred to any ReserveAccount. An amount of '9767.30 lakhs is proposed to be retained in the statement of Profitand Loss.
The paid up Equity Share Capital as on March 31 2020 was '1390.92 lakhs.
i) Issue of Equity Shares with differential rights Issue of Sweat Equity shares andIssue of Employee Stock Options
During the year under review the Company has not issued any shares with differentialvoting rights Issue of Sweat Equity shares and Issue of Employee Stock Options- (ESOS).
ii) Provision of money by company for purchase of its own shares by employees or bytrustees for the benefit of employees
The Company has no scheme of provision of money for purchase of its own shares byemployees or by trustees for the benefit of employees.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Investments covered under the provisions of Section 186 of the CompaniesAct 2013 read with the Companies (Meetings of Board and its Powers) Rules 2014 are givenin the notes to the Financial Statements. The details of loan given are provided in thenotes to Financial Statements. There are no guarantees issued by the Company.
AUDITORS AND AUDITORS' REPORT
a) Statutory Auditors
At the 48th Annual General Meeting of the Company held on 8th July 2017 the Membersof the Company have approved the appointment of M/s. B S R & Co. LLP CharteredAccountants (ICAI Firm Registration Number 101248W/W- 100022) as the Statutory Auditors ofthe Company pursuant to Section 139 of the Companies Act 2013 for a term of 5 (five)years from the Company's financial year 2017-18 to hold office from the conclusion of48th Annual General Meeting of the Company.
The report of the Statutory Auditors along with the Notes to Schedules forms part ofthe Annual Report and contains an Unmodified Opinion without any qualificationreservation or adverse remark.
b) Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hadappointed Messrs N. L. Bhatia & Associates a firm of Company Secretaries in Practiceto undertake the Secretarial Audit of the Company for the financial year 2019-20. Thereport of the Secretarial Auditor for the financial year 2019-20 and Annual SecretarialCompliance Report are unmodified and do not contain any qualification reservation oradverse remark. The Report of the Secretarial Auditor and Annual Secretarial ComplianceReport are annexed herewith as Annexure to Board's Report.
The Board of Directors of the Company has re-appointed M/s. N. L. Bhatia &Associates a firm of Company Secretaries in Practice to undertake the Secretarial Audit ofthe Company for the year 2020-21. They have confirmed their eligibility for theappointment.
In accordance with the provisions of Section 152 of the Companies Act 2013 and theArticles of Association of the Company Mr. Jaidev Rajnikant Shroff (DIN: 00191050)Non-Executive Director of the Company retires by rotation at the ensuing Annual GeneralMeeting of the Company and being eligible offers himself for re-appointment.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed both undersub-section (6) of Section 149 of the Companies Act 2013 and Regulation 16(b) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
In terms of Section 150 read with Rule 6 of the Companies (Appointment andQualification of Directors) Rules 2014 all Independent Directors of the Company havesuccessfully registered their name for inclusion in the 'Independent Directors Data Bank'maintained by the Indian Institute of Corporate Affairs.
Details of the familiarization programme of the independent directors are available onthe website of the Company http:// www.uelonline.com/investors
None of the Directors of the Company has incurred any disqualification.
Pursuant to the provisions of the Companies Act 2013 Regulations 17(10) and 25(4)(a)of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 annualperformance evaluation was carried out of the performance of the Board various BoardCommittees and the directors individually. Various parameters were considered forevaluation and after receiving the inputs from the Directors the performance evaluationexercise was carried out. The parameters included Business and Economics Management andLeadership Strategic Planning Mergers & Acquisitions Chemical Engineering FinanceRisk Compliance and Governance of directors Board's monitoring of various complianceslaying down and effective implementation of various policies level of engagement andcontribution of the directors safeguarding the interest of all stakeholders etc.
During the year under review all the Independent Directors met on 7th February 2020to discuss evaluation of the performance of Non Independent Directors and the Board ofDirectors as a whole evaluation of the performance of Chairman of the Company takinginto account the views of the Directors and evaluation of the quality content andtimelines of flow of information between the Management and the Board that is necessaryfor the Board to effectively and reasonably perform its duties. The performance ofevaluation of each Independent Director was carried out by the Board. The Directorsexpressed their satisfaction with the evaluation process.
The information of Director seeking re-appointment as required pursuant to Regulation36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015("SEBI Listing Regulations") and the Secretarial Standard on General Meetingsissued by The Institute of Company Secretaries of India is provide in the noticeconvening the 51st AGM of the Company.
The Board has on the recommendation of the Nomination and Remuneration Committeeframed and adopted the policy for selection and appointment of Directors Seniormanagement and their remuneration. The Remuneration Policy is stated in the CorporateGovernance Report which forms part of this Report. The policy lays down criteria forselection of directors and senior management such as expertise experience and integrityof the directors independent nature of the directors personal and professional standingdiversity of the Board etc. At present no Director of the Company receives anyremuneration from the Company except payment of sitting fess to some of the IndependentDirectors for attending the Board and Committee meetings. The Senior management employeesare working for the Company on deputation basis.
FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS
Pursuant to the Regulation 25(7) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has worked out a Familiarization programmefor the Independent Directors with a view to familiarize them with their role rights andresponsibilities in the Company nature of Industry in which the Company operatesbusiness model of the Company etc.
Through the Familiarization programme the Company apprises the independent directorsabout the financial performance internal control system statutory compliances andcorporate governance practices.
At the time of appointment of independent director a formal letter of appointment isgiven which explains role responsibility and rights in the Company.
Details of Familiarization programme of Independent Directors with the Company areavailable on the website of the Company http://www.uelonline.com/investors.
NUMBER OF MEETINGS OF THE BOARD AND BOARD COMMITTEES
The details of the number of Board and Board Committees meetings of the Company are setout in the Corporate Governance Report which forms part of this Report.
COMPOSITION OF BOARD COMMITTEES
Pursuant to the provisions of Section 177(1) of the Companies Act 2013 Rule 6 of theCompanies (Meetings of Board & Its Powers) Rules 2014 and Regulation 18 read withPart C of Schedule II to the Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015 the Company has constituted an AuditCommittee of the Board of Directors consisting of three Independent Directors. The detailsof the composition of the Audit Committee is provided in the Corporate Governance Reportwhich forms part of this Report. During the Financial Year 2019-20 all recommendationsmade by the Audit Committee to the Board of Directors were accepted by the Board and therewere no instances where the recommendations were not accepted.
Nomination and Remuneration Committee
Pursuant to the provisions of Section 178 of the Companies Act 2013 Rule 6 of theCompanies (Meetings of Board & Its Powers) Rules 2014 and Regulation 19 read withPart D of Schedule II to the Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015 the Company has constituted a Nominationand Remuneration Committee of the Board of Directors consisting of three IndependentDirectors. The details of the composition of the Nomination and Remuneration Committee isprovided in the Corporate Governance Report which forms part of this Report.
Stakeholders' Relationship Committee
Pursuant to the provisions of Section 178 of the Companies Act 2013 and Regulation 20read with Part D of Schedule II to the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 your Company has constituted aStakeholders' Relationship Committee of the Board of Directors comprising of threeIndependent Directors. The details of the composition of the Stakeholders' RelationshipCommittee is provided in the Corporate Governance Report which forms part of this Report.
KEY MANAGERIAL PERSONNEL
Mr. Rajnikant Devidas Shroff (DIN 00180810) Chairman and Managing Director Mr. K. M.Thacker (Membership No. ACS 6843) Company Secretary and Mr. Bipin P. Chheda ChiefFinancial Officer are the Key Managerial Personnel of your
Company in accordance with the provisions of Sections 2(51) 203 of the Companies Act2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.
DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL ANDPARTICULARS OF EMPLOYEES
As none of the Directors of your Company receives remuneration from the Company and theSenior management employees are working for the Company on deputation basis theinformation required under Section 197(12) of the Companies Act 2013 read with Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended from time to time in respect of Directors/ employees of your Company is notgiven.
The Company has no employee who- (i) if employed throughout the financial year was inreceipt of remuneration in aggregate more than 'one crore and two lakh or (ii) ifemployed for a part of the financial year was in receipt of remuneration in aggregatemore than 'eight lakh and fifty thousand per month. Hence the information required to begiven pursuant to the provisions of Section 197(12) of the Companies Act 2013 read withRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 as amended from time to time is not applicable and hence not attached.
RELATED PARTY TRANSACTIONS
All Related Party Transactions entered into during the year were on arm's length basisand were in the ordinary course of business. There were no materially significant relatedparty transactions made by the Company with Promoters Directors Key Managerial Personnelor other designated persons which may have a potential conflict with the interest of theCompany at large.
All Related Party Transactions are approved by the Audit Committee. Prior omnibusapproval is obtained from the Audit Committee in respect of the transactions which arerepetitive in nature. The transactions entered into pursuant to the omnibus approval sogranted are reviewed on a quarterly basis by the audit committee.
The policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website. The same can be accessed on www.uelonline.com/investors
Since there were no materially significant related party transactions entered intoduring the year the Form AOC- 2 pursuant to Section 134(3)(h) of the Companies Act 2013read with Rule 8(2) of the Companies (Accounts) Rules 2014 is not attached to thisReport.
VIGIL MECHANISM/WHISTLEBLOWER POLICY
The Company has formed whistleblower policy to deal with any fraud irregularity ormismanagement in the Company. The policy enables any employee or director to directlycommunicate to the
Chairman of the Audit Committee to report any fraud irregularity or mismanagement inthe Company. The policy ensures strict confidentiality while dealing with concerns andalso that no discrimination or victimization is meted out to any whistleblower. The policyis also posted on the website of the Company http:// www.uelonline.com/investors
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an internal control system commensurate with the size scale andcomplexity of its operation. The Group has an inhouse internal audit team headed by aqualified professional which undertakes internal audit and ensures that all transactionsare authorized and recorded in the books of the Company. The internal audit departmentmonitors the efficacy and adequacy of internal control. Significant audit observations ifany are presented to the Audit Committee and action taken to correct any deficiency isinformed to them. The report prepared by internal audit team forms the basis ofutilization by the Managing Director and Chief Financial Officer for financial reportingas required under Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
Internal Controls over Financial Reporting:
The Company has adequate internal financial controls in place commensurate with thesize scale and complexity of its operations.
The Company is complying with all the applicable Accounting Standards. The accountingrecords are maintained in accordance with generally accepted accounting principles inIndia. This ensures that the financial statements reflect true and fair financial positionof the Company.
RISK MANAGEMENT FRAMEWORK
Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015the Company has prepared Risk Management Framework for identifying and evaluating variousmajor business risks faced by the Company. Risk Management Framework aims to lay down theprocedure for risk assessment and risk minimization. Risk Management Framework is preparedto ensure internal controls and effectively respond to any changes in the businessenvironment so as to achieve high degree of business performance limit any negativeimpact on its working and avail of benefits arising out of any business opportunities.There are standard practices in place to ensure that strong financial controls are inplace.
The audit committee has additional oversight in the area of financial risks andcontrols.
Key business risks perceived by the Company and mitigating initiatives are as under:
- Funding risk: As there are no much activities in the Company the Company may not beable to mobilize adequate funds if any in time. The mitigating factors are that theCompany has good investment in the quoted shares so raising additional funds if anywill not be difficult for the Company.
- Regulatory risk: Any change in Government/Regulators Policy/Rules/Regulations willrequire fresh compliances. The mitigating factors are that the group has very strong anddedicated team consisting of professionals to study regulatory changes and freshrequirement.
- Foreign currency fluctuation risk: - The Company is engaged in the tradingactivities which may subject to risk of less profit/loss on account of volatility inforeign currency exchange. The mitigating factors are that the management ensures toenters in trading transactions in such a way that there are minimal risks of volatility inforeign currency exchange or the Company may take adequate forward cover for foreignexchange fluctuations.
- Risks due to disruption and unprecedented uncertainty due to Covid-19 pandemic andImpact on Business: - Products may not be available as per demand. Also supplier/customermay not be available and there may be delay in receipt of money from customer. Furtherthe Company's revenue is mainly from other income consisting of dividend on equity sharesand interest on loans. The financial assets of the Company are mainly investments inlisted securities and accordingly any material volatility in the capital market mayimpact the market value of the investment. The mitigating factors are that the Company'strading operations are at very miniscule level compared to overall income. The Companyseals a deal only when customer and supplier are available at negotiated price and thereis reasonable assurance of availability of products. The customers are also chosen basedon their financial strengths. Till now the Company has not experienced any issue in anyof the deals. Hence the revenue of the Company is not likely to be impacted by COVID-19pandemic.
REPORTING OF FRAUD:
The Auditors of the Company have not reported any fraud as specified under section 143(12) of the Companies Act 2013.
99.24 % of the total paid up equity shares of the Company are dematerialized as on 31stMarch 2020.
INFORMATION REGARDING CONSERVATION OF ENERGY ETC.
The particulars relating to energy conservation technology absorption foreignexchange earnings and outgo as required to be disclosed under sections 134(3)(m) of theCompanies Act 2013 read with the Rule 8(3) of the Companies (Accounts) Rules 2014 forthe year 31st March 2020 is furnished here below.
I. CONSERVATION OF ENERGY - Not Applicable
II. TECHNOLOGY ABSORPTION - Not Applicable
III. FOREIGN EXCHANGE EARNING AND OUTGO
| ||Rs. in Lakhs. |
|(a) Foreign Exchange earned ||- |
|(b) Foreign Exchange outgo ||3.06 |
To the best of their knowledge and belief and according to the information andexplanations obtained by them the directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:
a) That in the preparation of the annual financial statements for the year ended 31stMarch 2020 the applicable accounting standards have been followed along with properexplanation relating to material departures if any.
b) That such accounting policies as mentioned in Note 2.1 of the Notes to the FinancialStatements have been selected and applied consistently and judgement and estimates havebeen made that are reasonable and prudent so as to give a true and fair view of the stateof affairs of the Company as at March 31 2020 and of the profit of the Company for theyear ended on that date.
c) That proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities.
d) That the annual financial statements have been prepared on a going concern basis.
e) That proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.
f) That systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
Your Company and its Board has been complying with Corporate Governance to the extentset out in this respect as a separate report in pursuance of requirement of para C ofSchedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 asapplicable. A Certificate from Auditors regarding compliance of the conditions ofCorporate Governance as stipulated under para E of Schedule V SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 is attached and forms integral part of thisReport.
BUSINESS RESPONSIBILITY REPORTING
A separate section of Business Responsibility is attached and forms part of this AnnualReport as required under Regulation 34(2)(f) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Board of Directors state that applicable Secretarial Standards
i.e. SS-1 and SS-2 issued by the Institute of Companies Secretaries of Indiarelating to "Meetings of the Board of Directors" and "GeneralMeetings" respectively have been duly followed by the Company.
DEALING WITH SECURITIES WHICH HAVE REMAINED UNCLAIMED
Members are hereby informed that as per Regulation 39(4) read with Schedule VI of theSEBI Regulations the Company is in the process of sending reminders to those Memberswhose share certificates have remained unclaimed to contact the Company immediately inthe matter. The Registrar and Transfer Agent M/s. Link Intime India Pvt. Ltd. is in theprocess of compiling the data for unclaimed shares. The Company now after following theprescribed procedure will dematerialize unclaimed shares which are retained with theCompany. These shares would be held by the Company on behalf of the holders of such sharesin an "Unclaimed Suspense Account" to be opened with a depository. At the end ofseven years hereof these shares shall be transferred by the Company to the IEPF.
Members may note that the lawful claimant in respect of these shares will be able toclaim such shares from the Company till such time they remain in the unclaimed suspenseaccount as aforesaid.
EXTRACT OF ANNUAL RETURN
Pursuant to the Section 92(3) of the Companies Act 2013 a copy of Annual Return hasbeen placed on the website of the Company and the web link of such Annual Return iswww.uelonline.com/ investors
LISTING OF THE COMPANY'S EQUITY SHARES/GDR
The Equity Shares of your Company continue to be listed at the BSE Ltd. and NationalStock Exchange of India Ltd. There is no default in paying annual listing fees.
The Board of Directors at its meeting held on 7th February 2020 has resolved toterminate the GDR program. The notice of termination of GDR program was sent to allholders of GDR on 14th February 2020 by Bank of New York Mellon Custodian of GDR. Thenotice was open for 120 days subsequent to which Bank of New York Mellon Custodian hasterminated the program. Subsequent to termination of GDRs programme the Luxemburg StockExchange has delisted the GDRs.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant material orders passed by the Regulators/Courts which wouldimpact the going concern status of the Company and its future operations.
EVENTS AFTER BALANCE SHEET DATE
There have been no material changes and commitments affecting the financial positionof the Company which have occurred between the end of the financial year of the Companyto which the balance sheet relates and the date of this Report.
No disclosure or reporting is required in respect of the following points as there wereno transactions on these items or were not applicable to your Company during the yearunder review.
a) The Company has no subsidiary as on 31st March 2020;
b) The Company has not accepted any deposits from public.
c) Details about the policy developed and implemented by the Company on corporatesocial responsibility initiatives taken during the year.
d) Disclosure as per Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013
Your Directors are thankful to all the stakeholders and various government agencies andministries for their continued support.
Your Directors are deeply pained and regret the loss of life due to COVID-19 pandemicand are deeply grateful towards the Corona Warriors who are working tirelessly to fightthis pandemic crisis.
Statements in the Director's Report and the Management Discussion and Analysisdescribing the Company's objectives expectations or predictions may be forward lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed in the statement. Important factors that couldinfluence the Company's operations include: changes in government policies and tax lawseconomic development of the country and other factors which are material to the businessoperations of the Company.
|Mumbai ||By Order of the Board of Directors |
|26th June 2020 ||For UNIPHOS ENTERPRISES LTD. |
|Registered Office: || |
|11 G.I.D.C. Vapi || |
|Dist. Valsad Gujarat ||Rajnikant Devidas Shroff |
|Pin- 396 195. ||Chairman & Managing Director |
|CIN: L24219GJ1969PLC0I ||01588 (DIN: 00180810) |