Your directors have pleasure in presenting the 48th Annual Report of theCompany along with audited statements of accounts for the year ended 31st March2021. The summarized financial results are given below:
(Rs. In Lacs.)
|Particulars ||2020-2021 ||2019-2020 |
|Total Sales and Other Income ||29739 ||26601 |
|Profit before depreciation ||1123 ||534 |
|Depreciation ||400 ||493 |
|(Loss) / Profit Before tax ||723 ||41 |
|Provision for taxation (Including Deferred & Current Tax) ||87 ||(25) |
|( Loss) / Profit after tax ||636 ||66 |
|Less - Income Tax / IND-AS Adjustment ||- ||23 |
|Balance brought forward ||(49) ||(138) |
|Balance Carried forward to Balance Sheet ||587 ||(49) |
In view of profit during the year under review the Board of Directors do not recommendany dividend for the Financial year ended 31st March 2021. COVID -19 Thenational lockdown in March 2020 and imposition of Curfew in some states due to outbreakof COVID-19 Pandemic has changed the overall economic activity resulting in seriousdisruption of business operations. The Company has taken necessary steps from time to timeto contain the impact of pandemic.
PERFORMANCE REVIEW BUSINESS AFFAIRS & OUTLOOK
Your Company's total Sale and other income for the year amounting to Rs. 29739 Lacs ascompared to Rs. 26601 Lacs of last year. The result for the year shows profit beforeDepreciation of Rs. 1123 Lacs as against profit before depreciation of Rs. 534 Lacs inthe previous year net profit before tax is Rs. 723 Lacs as compared to profit of Rs. 41Lacs in the previous year. The increase in operational profit was due to market condition.Further details of operation are given in the management discussion and analysis reportwhich form part of this report.
With better raw material situation & reasonable prices of the maize crop we arecontinuously optimistic about the current year. Your company continues its endeavor toexpand into new export markets which will in turn increase the turnover further.
TRANSFER TO RESERVE:
No amount has been transferred to reserves during the year under review.
The Company has not accepted any public deposits within the meaning of Section 73 ofthe Companies Act 2013 and rule made there under.
CHANGES IN SHARE CAPITAL:
During the year under review there was no change in the Authorized or Paid ShareCapital of the Company.
DIRECTOR'S RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) ofthe Companies Act 2013 Directors of your Company herebystate and confirm that:
a) in the preparation of the annual accounts for the year ended 31st March2021 the applicable accounting standards have been followed along with proper explanationrelating to material departures;
b) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the profitof the company for the same period;
c) the directors have taken proper and sufficient care 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) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls in the company that are adequate andwere operating effectively;
f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and these are adequate and are operating effectively.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
The composition of the Board is as per the Companies Act 2013 and the SEBI (ListingObligations and Disclosure Requirements) (LODR) Regulations 2015. All the Directors arehaving vast knowledge and experience in their relevant fields and the Company hadbenefited immensely by their presence in the Board.
In accordance with the provisions of section 152 of the Companies Act 2013 Mrs.Nayankuwar Jitendrasinh Rawal (DIN: 03605134) and Mr. Subhash H. Rajput (DIN: 08602709)who retires by rotation and being eligible offers themselves for re-appointment.
Mr. Jaykumar J. Rawal (DIN: 02261128) appointed as Additional Whole-Time Director(Business Development) of the Company with effect from 01st April 2021 for theperiod of three years and same has been approved in the Board of Directors Meeting held on25th March 2021 & place for members approval.
Re-appointment of Mr. Jitendrasinh J. Rawal (DIN: 00235016) as Chairman and ManagingDirector with effect from 01st October 2021 for further period of three yearsand same has been approved in the Board of Directors meeting held on 14thAugust 2021 and place for members approval.
Re-Appointment of Mrs. Hansarani Vaghela (DIN: 01468168) as Whole Time Director (JointManaging Director) of the Company with effect from 11th August 2021 forfurther period of three years and same has been approved in the Board of Directors meetingheld on 14th August 2021 and place for members approval.
Appointment of Mr. Vishal Thakkar (DIN: 05327900) as an Independent Director for a termof five consecutive years in terms of Section 149 of the Companies Act 2013 and same hasbeen approved in the Board of Directors meeting held on 11th February 2021 andplace for members approval.
Mr. Ashok N Kothary Mr. Bindu Madhavan Mrs. Sudha Ramesh Modi Mr. Ashok Shah Mr.Dev Prakash Hemraj Yadava Mr. Vishal Thakkar all are existing Independent Directors ofthe Company. The above directors have given declaration to the Board that they meet thecriteria of independence as provided under section 149(6) of the Act. In the opinion ofthe Board each of these directors fulfill the conditions specified in the Act and theRules framed thereunder for appointment as Independent Director.
DISCLOSURE OF PECUNIARY RELATIONSHIP:
There was no pecuniary relationship or transactions of the nonexecutive directorsvis-a-vis the company during the year. Also no payment except sitting fees was made toany of the nonexecutive directors of the Company.
STATEMENT ON DECLARATION BY INDEPENDENT DIRECTORS:
Mr. Ashok Kothary (DIN: 00811919) Mr. Dev Prakash Yadava (DIN: 00778976) Mr.Bindumadhavan Venkatesh (DIN: 01799569) Mr. Ashok Shah (DIN: 00236555) Mrs. Sudha Modi(DIN: 01633060) and Mr. Vishal Thakkar (DIN: 05327900) Independent Directors of theCompany have given their respective declaration as required under Section 149 (7) of theCompanies Act 2013 to the effect that they meet the criteria of independence as providedin Section 149 (6) of the Companies Act 2013 which were taken on record by the Board.
NUMBER OF MEETINGS OF THE BOARD:
During the financial year 2020-21 five meetings of the Board of Directors were held.For details of the Board meetings please refer to the Corporate Governance Report formingpart of the Boards' Report.
STATEMENT ON ANNUAL EVALUATION OF BOARD COMMITTEE AND ITS DIRECTORS:
The Board of directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of Section 134 (3)(p) of the Companies Act 2013 read with Rule 8(4) of The Companies (Accounts) Rules 2014and the corporate governance requirements as prescribed by Securities and Exchange Boardof India ("SEBI").
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning transparency adhering togood corporate governance practices etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Nomination and Remuneration Committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the Board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings leadershipquality attitude initiatives decision making commitment achievements etc. In additionthe Chairman was also evaluated on the key aspects of his role.
In a separate meeting of Independent Directors on 25th March 2021performance of non-independent directors performance of the board as a whole andperformance of the Chairman was evaluated taking into account the views of executivedirectors and non-executive directors. The meeting also assessed the quality quantity andtime lines of flow of information between the company management and the board that isnecessary for the board to effectively and reasonably perform its duties.
NOMINATION AND REMUNERATION POLICY:
In terms of Section 178 (3) of the Companies Act 2013 a policy on Nomination andRemuneration of Directors and Senior Management Employees including inter alia criteriafor determining qualifications positive attributes and independence of directors wasformulated by the Nomination and Remuneration Committee and adopted by the Board ofDirectors. The said policy is annexed as Annexure A to the Board's Report. The said policyis also posted on the website of the Company www.universalstarch.com and its weblink is:http://www.universalstarch.com/Nomination%20and%20 Remuneration%20Policy.pdf
INTERNAL FINANCIAL CONTROLS:
The Company has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of fraud and errors the accuracyand completeness of the accounting records and timely preparation of reliable financialdisclosures.
COMMITTEES OF THE BOARD:
The details pertaining to composition various Committees i.e Audit CommitteeNomination & Remuneration Committee Stakeholders Relationship Committee are includedin the Corporate Governance Report which forms part of this report.
AUDITORS & AUDIT REPORTS:
i) Statutory Auditors:
M/s. S. M. Gupta & Co Chartered Accountants were appointed as Statutory Auditorsof your Company at the Annual General Meeting held on 29th September 2017 fora term of five consecutive years. As per the provisions of Section 139 of the CompaniesAct 2013 the appointment of Auditors is required to be ratified by Members at everyAnnual General Meeting.
In accordance with the Companies Amendment Act 2017 enforced on 7th May2018 by the Ministry of Corporate Affairs the appointment of Statutory Auditors is notrequired to be ratified at every Annual General Meeting.
ii) Secretarial Auditors:
According to the provision of section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard has appointed M/s. Leena Agrawal & Co as secretarial auditor of the Company forthe F.Y 2021-2022.
i) Independent Auditor's Report does not contain any qualifications reservation oradverse remark and the fair view of the financial statement is not affected. Audit reportis enclosed as a part of this report.
ii) Secretarial Auditor's Report does not contain any qualifications reservation oradverse remark. Audit report is enclosed as a part of this report.
EXPLANATION AND COMMENTS BY THE BOARD ON DISCLAIMER MADE IN AUDITORS' REPORT ANDSECRETARIAL AUDITOR'S REPORT:
The Auditors' Report and Secretarial Auditor's Report does not contain anyqualifications reservations or adverse remarks and the true and fair view of thefinancial statements is not affected.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
RISK MANAGEMENT POLICY:
The Company has adopted a Risk Management Policy and implemented a mechanism for riskassessment and management. The policy provides for identification of possible risksassociated with the business of the Company assessment of the same at
regular intervals and taking appropriate measures and controls to manage mitigate andhandle them. The key categories of risk jotted down in the Policy are Strategic RisksFinancial Risks Operational Risks and such other risk that may potentially affect theworking of the Company. The risk management framework is supported by the Board ofDirectors Management and the Audit Committee. The Board periodically reviews the risksand suggests steps to be taken to control and mitigate the same through a properly definedframework. At present in the opinion of the Board of Directors there are no risk whichmay threaten the existence of the Company.
CORPORATE SOCIAL RESPONSIBILITY:
The report on Corporate Social Responsibility activities carried out during financialyear 2020-21 is annexed herewith as "Annexure D" to this report.
LISTING WITH STOCK EXCHANGE:
At present your Company's securities are listed on:
BSE Phiroze Jeejeehoy Towers Dalal Street Fort Mumbai- 400001 Code No. 524408.
In pursuant to the provisions of Sections 177 (9) & (10) of the Companies Act2013 a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished.
EXTRACT OF ANNUAL RETURN:
In compliance with provisions of Section 134(3)(a) of the Companies Act 2013 theAnnual Return as per Section 92(3) of the Companies Act 2013 has been hosted on thewebsite of the Company on the link https://universalstarch.com/MGT-7%20 PDF.pdf
REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:
The information required pursuant to Section 197 (12) read with Rule 5(1) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 and Companies(Particulars of Employees) Rules 1975 in respect of employees of the Company andDirectors is furnished here under:
|Sr. Name No ||Designation ||Remuneration paid in FY 2020-21 (In Rs.) ||Remuneration paid in FY 2019-20 (In Rs.) ||Increase/ Decrease in remuneration from previous year (In Rs.) ||% Increase/ Decrease in remuneration from previous year (In Rs.) ||Ratio/Times per Median of employee remuneration |
|1 Mr. Jitendrasinh J. Rawal ||Chairman & Managing Director ||*9210720 ||5954400 ||3256320 ||54.69 ||76.19 |
|2 Mrs. Hansarani Vaghela ||Whole-time director (Works) ||2688000 ||2688000 || || ||22.24 |
|3 Mrs. Nayankuwar J. Rawal ||Whole-time director ||537600 ||537600 ||- ||- ||4.45 |
|4 Mr Subhash R Rajput (w.e.f 12.11.2019) ||Whole-time director ||608558 ||169128 ||439430 ||259.82 ||5.03 |
|5 Mr Subramani Seetharaman ||Chief Financial Officer (KMP) ||1120859 ||1200000 ||(79141) ||(6.60) ||9.27 |
|6 Mrs. Chaitali Salgaonkar ||Company Secretary (KMP) ||745314 ||756697 ||(11383) ||(1.50) ||6.17 |
The non- executive directors were paid only sitting fees of Rs. 825000/- during theFY 2020-21 out of which Rs 100000/- was paid for the Meeting held on 19thMarch 2020. Due to COVID-19 Pandemic it was settled in the FY 2020-21.
*Mr. Jitendrasinh J. Rawal paid full remuneration for the FY 202021 as per terms andconditions approved by the shareholders in the AGM held on 29-09-2018.
There were 400 permanent employees on the payroll of the Company as on 31stMarch 2021
DISCLOSURE UNDER RULE 5(2) AND RULE 5(3) OF THE COMPANIES (APPOINTMENT AND REMUNERATIONOF MANAGERIAL PERSONNEL) RULES 2014 that the details of employees in receipt ofremuneration in the aggregate not less than INR 1 crore and 2 lacs pa. if employedthroughout the year or INR 8.50 lacs pm if employed for a part of the year during 2020-21:
There are no employees covered under Rule 5 (2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 in respect of whom particulars arerequired to be furnished.
SUBSIDIARIES/JOINT VENTURE/ASSOCIATE COMPANY:
The Company has no subsidiary/joint venture/associate company and hence consolidationand applicable provision under the Companies Act 2013 and Rules made there under are notapplicable to the Company.
CHANGES IN NATURE OF BUSINESS IF ANY: During the year under review there is nochange in the nature of business of the Company.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The company has in place an Anti Harassment policy in line with the requirements of thesexual harassment of women at the workplace (Prevention Prohibition & Redressal) Act2013. Internal Complaints Committee (ICC) has been set up to redress complaints receivedregarding sexual harassment. All employees (permanent contractual temporary trainees)are covered under this policy. During the year under review company has not received anySexual Harassment Complaints and no complaints pending as on end of financial year.
DISCLOSURE REGARDING ISSUE OF EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS:
During the year under review the Company has not issued any shares with differentialvoting rights.
DISCLOSURE REGARDING ISSUE OF EMPLOYEE STOCK OPTION SCHEME
During the year under review no option under 'Employee Stock Option Scheme was grantedor vested to any employee or directors of the Company.
DISCLOSURE REGARDING ISSUE OF SWEAT EQUITY SHARES:
During the year under review the Company has not issued any Sweat Equity Shares.
MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There have not been any material changes and commitment affecting the financialposition of the Company during the financial year 2020-21.
INFORMATION REQUIRED UNDER RULE 8 (3) OF THE COMPANIES (ACCOUNTS) RULES2014-CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
a) Conservation of Energy:
The activities of your company require minimal energy consumption and every endeavourhas been made to ensure the optimal use of energy avoid wastage and conserve energy asfar as possible.
b) Technology Absorption:
1. The Company has successfully implemented the procedures to improve the productivityquality energy saving GMP and GHP.
The R & D Department is active in upgrading the technology of production of valueadded products through finely tuning the SOP.
The range of value added products have been widened to satisfy the specificapplications in pharmaceutical food and paper industry. The Company received GMP licensefrom FDA (MS).
2. The Company implemented Pest Control schedules in the premises by M/s. Pest Control(India)P. Ltd. Jalgaon. This is mandatory to maintain the hygiene Standards in themanufacturing and storage of products. The Pest control schedules resulted control onTotal Bacterial Count (TBC) and Total Fungal Count (TFC) along with control of pathogensin finished products.
3. The Company established Air Handling Unit (AHU) at Microbiology Laboratory as thecompliance of the mandatory requirements by FDA.
4. The Company has already established the following Projects:
Biomethanation Project Co-Generation Power Plant Wind Mill at Brahmanwel.
c) Foreign exchange earnings and outgo:
The details of foreign exchange earnings and outgo are detailed in Note No. 33 formingpart of Accounts.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
During the period under review no order had been passed by the regulators/ courts ortribunals which have an effect on the going concern status of the company and itsoperations.
The relations of the management with staff and workers remained cordial during theentire year.
Your Company has complied with the Corporate Governance practices mandated by ListingRegulations. The company has adopted the Code of Conduct which is also available on thewebsite of the Company. All the Board members and Senior Management Personnel haveaffirmed compliance with the code of conduct. The Corporate Governance Report along withthe Certificate from Ms. Pankita Lakhani partner of M/s Leena Agrawal & CompanyPractising Company Secretaries is set out as part of the Annual Report. A ManagementDiscussion and Analysis Report also accompanies this report.
DEVELOPMENT AND IMPLEMENTATION OF A MANAGEMENT POLICY:
The Company has been addressing various risks impacting the Company and the policy ofthe Company on risk management is provided elsewhere in this Annual Report in ManagementDiscussion and Analysis.
RELATED PARTY TRANSACTIONS:
Related party transactions that were entered during the financial year were on an arm'slength basis and were in the ordinary course of business. There were no materiallysignificant related party transactions with the Company's Promoters Directors Managementor their relatives which could have had a potential conflict with the interests of theCompany. Transactions with related parties entered by the Company in the normal course ofbusiness are periodically placed before the Audit Committee for its omnibus approval andthe particulars of contracts entered during the year is given in Note 37 of the FinancialStatements. The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 the Rulesthereunder and the Listing Agreement. This Policy was considered and approved by theBoard. The said policy is posted on the website of the Company www.universalstarch.comand its weblink is http://www.
REPORTING OF FRAUDS:
During the year under review there was no instance of fraud which required theStatutory Auditors to report to the Audit Committee and /or Board under Section 143(12) ofthe Companies Act 2013 and the rules made thereunder.
IMPACT OF COVID-19
The lockdowns and restrictions imposed on various activities due to COVID - 19 pandemichave posed challenges to the operations of the Company. Factory operations resumedselectively post approvals from authorities with limited manpower by strictly followingthe advisory / guidelines of Government particularly for social distancing sanitizing ofpersons and premises and majority of its staff working from home. Company has provided allnecessary access to its employees to work from home to continue operations smoothly.
The company also faced business interruption on account of the lockdown and was able tocontinue only limited operations during the lockdown period with large number of employeesopting to stay at home in terms of the Government advisory non-availability of transportfor mobility and other related reasons. Since the situation is exceptional it may not bepossible to estimate the future impact on its operations with certainty.
Your Directors take this opportunity to express their appreciation and gratitude to theUnion Government State Government The Shamrao Vithal Co-op.Bank Ltd. The MumbaiDistrict Central Co-operative Bank Ltd Mumbai Customers and our valued shareholders oftheir kind support co-operation and guidance.
For and on behalf of the Board of Directors Universal Starch Chem Allied Limited
| ||Sd/- |
| ||Jitendrasinh J. Rawal |
|Place: Mumbai ||Chairman & Managing Director |
|Date: 14th August 2021 ||DIN:00235016 |