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Ushanti Colour Chem Ltd.

BSE: 535099 Sector: Industrials
NSE: UCL ISIN Code: INE00NI01015
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Ushanti Colour Chem Ltd. (UCL) - Director Report

Company director report

To the Members

Your Directors are pleased to present the 27th Annual Report of the Company along withAudited Standalone and Consolidated Financial Statements for the financial year ended 31stMarch 2020.

Financial Results

The Company's financial performance for the year ended March 31 2020 is summarizedbelow:

(Rs. In Rs.)

Financial Highlights

Standalone

Consolidated
Financial Year 2019-20 (FY 2020) Financial Year 2018-19 (FY 2019) Financial Year 2019-20 (FY 2020)
Revenue from Operations 460326941 402034129 460326941
Other Income 5159329 7775822 5159329
Total Income 465486270 409809951 465486270
Total Expenses 433385350 379479058 433385350
Profit before Exceptional and Extra Ordinary items and Taxation 32100920 30330893 32100920
Less: Exceptional items 0 0 0
Profit before Extra -Ordinary items and Taxation 32100920 30330893 32100920
Less: Extra -Ordinary items 0 0 0
Profit before Taxation 32100920 30330893 32100920
Less: Provision for Tax Current Tax 9003679 8200000 9003679
Add: Provision for Tax Deferred Tax (Net) 646000 261000 646000
Profit for the year 23743241 22391893 23743241

Performance / Highlights of the Company

During the year under review your company has achieved Revenue from Operation of Rs.4603.27 lacs as against Rs. 4020.34 lacs which recorded a growth of 14.50%.

Other Income during FY 2019-20 was Rs. 51.59 lacs as against Rs. 77.76 lacs whichrecorded a reduction of 33.65%.

The Company recorded Profit before Tax of Rs. 321.01 lacs as against Rs. 303.31 lacswhich recorded a growth of 5.84%.

COVID-19

The COVID 19- Coronavirus Pandemic impacted not only our Company but the whole nation.To reduce the spread of COVID 19 Government of India first asked a day's lockdownthrough Janata Curfew on March 22 2020 the Government of Gujarat announced a lockdownfrom March 23-25 2020 and then Government of India announced a nationwide lockdown onMarch 25 2020. However before the said announcement various safety measures had beentaken by the Company like using mask gloves social distancing sanitizing and washinghands etc. But after announcement the Company had to shut down its business and obey allthe guidelines issued by the Government.

Due to lockdown Company had to shut down its plant and operation activity due towhich the Company was unable to supply its products to its clients. It badly impacted onthe financial position of the company as Company did not reach its desired expectations.In the last week of April 2020 after getting approval from the concerned authorityCompany resumed its partial operations along with all safety measures to stabilize itsoperation at certain level. Due the fact that this was a pandemic which affected all thecountries including India many orders of our company were cancelled/ postponed.

Now as off today Company is operating at 40-50% capacity after taking care of all thesafety measures and guidelines issued by Government strictly so that Company is able toramp-up its production up to 80-90% of normal level.

Business Outlook

In China due to increasing environmental norms and strict governmental regulationsw.r.t operating a chemical industry there have been shutdowns of many facilities andbecause of this Dye industry in India has huge opportunity to expand business whichpositively impacting the dye industry in India consequently growth in Dye prices.

With the adoption of Goods and Service Tax (GST) Indian Markets will witness new eraof business. This will lead to more organized and growth oriented economy.

Due to COVID-19 pandemic and having nationwide lockdown growth of the Company has beenaffected. Considering the opportunities threats and strengths of your Company managementcontinuously works for increasing the productivity of the Company and meet the demand ofclients so that Company can gradually stable its position in the market. The management isof the view that future prospects and growth of your Company will depend on the overalleconomic scenario. However all necessary activities have been initiated which would giveus the lead in future.

Change in the Nature of Business

There was no Change in the nature of the business of the Company done during the year.

Annual Return

The extracts of Annual Return pursuant to the provisions of Section 92 of the CompaniesAct 2013 read with Rule 12 of the Companies (Management and administration) Rules 2014is furnished in Form MGT-9 and is appended to this Report as

‘Annexure I'.

Board Meetings conducted during the year under review

During the Financial year 2019-20 14 (Fourteen) Board Meetings were convened and held.The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013.

Meetings were conducted on 03rd April 2019 27th May 2019 30th May 2019 27th June2019 29th July 2019 27th August 2019 03rd October 2019 23rd October 2019 12thNovember 2019 19th December 2019 23rd December 2019 13th January 2020 06thFebruary 2020 21st March 2020.

The detail of attendance at the aforesaid meeting is as follows:

Name of Directors Designation No. of Meetings
Held during their respective tenures Attended
Mr. Maunal Shantilal Gandhi Joint Managing Director 14 14
Mr. Minku Shantibhai Gandhi Joint Managing Director 14 14
Mr. Shantilal Bhailal Gandhi Chairman and Executive Director 14 14
Mr. Shailesh Indradaman Patwari Independent Director 14 09
Mrs. Hanisha Jinish Patel Independent Director 14 10
Mrs. Purvi Tapan Trivedi Independent Director 14 10

Annual General Meeting and Extra Ordinary General Meeting

The 26th Annual General Meeting (AGM) of the Company was held on September28 2019.

During the Financial year 2019-20 Company has convened and held general meeting bymeans of postal ballot from October 29 2019 to November 27 2019.

Directors' Responsibility Statement

Pursuant to section 134(5) of the Companies Act 2013 Your Directors state that:

a) In the preparation of the annual accounts for the year ended March 31 2020 theapplicable accounting standards had been followed and there are no material departuresfrom the same

b) The Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2020 and of the profit ofthe Company for the year ended on that date

c) The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities

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

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

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

Comment on Auditor's Report

The Auditors Report is annexed with the Annual Report of the Company. The observationmade by Auditors in their Report your Directors wish to state that the report is self -explanatory and do not require any further clarification from the Board.

Particulars of Loans Guarantees or Investments made under Section 186 of the CompaniesAct 2013

The details of loans guarantees securities and investments covered under theprovisions of Section 186 of the Companies Act 2013 are provided in the financialstatement.

Particulars of Contracts or Arrangements made with Related Parties

The Company presents all related party transactions before the Board specifying thenature value and terms and conditions of the transaction. Transactions with relatedparties are conducted in a transparent manner with the interest of the Company andStakeholders as utmost priority.

Particulars of Contracts entered into with Related Parties referred to in Section188(1) of the Companies Act 2013 in prescribed Form AOC-2 is attached as an‘Annexure II' to this Report.

The State of Company's Affairs

During the year Company served its reputed clients best of its services and ensure thatin future also will do the same. Company is thankful towards stakeholders for beingassociate with it because without them growth of the Company is not easily possible.

Incorporation of Company: During the year company has incorporated its Wholly OwnedSubsidiary Company in the name of M/s. UC Colours and Intermediates Private Limited whichis now become a Subsidiary of the Company.

Change of Object of the IPO Proceeds: During the year company has changed its object ofthe issue of Initial Public Offer (IPO) from “To finance setting up of DyestuffPigment and Intermediates manufacturing facility at GIDC Saykha Industrial EstateBharuch” to “To finance setting up of Dyestuff Pigment Chemical andIntermediates manufacturing facility in Gujarat either by UCL or by Special PurposeVehicle (“SPV”)”.

Main Reasons for variation in objects to the issue are;

1. Tax Benefits- Recently Union Finance Minister (“UFM”) has announced lowerIncome Tax rate and No MAT for new Companies incorporating after October 01 2019 whichmake sense for establishment of new Company rather than investment in Ushanti Colour ChemLimited.

2. Cost- The Project Cost is quite high and there is a requirement of additionalcapital which will be fulfilled by SPV.

3. Subsidy- The Industrial Subsidy Policy of the Government of Gujarat (GoG) ensuresreimbursement of subsidy through net SGST to be paid to GoG. Most of the sale is to bedone in Gujarat based companies including M/s. Ushanti Colour Chem Limited. Hence if theproject is in the name of Ushanti Colour Chem Limited then net SGST would not be availablefor intra-company transfer.

pursuant to Regulation 14 of Listing Regulation the Annual Listing fees for the year2020-21 have been paid within due date. The bills for annual custodian fees to NSDL &CDSL have been paid by the Company for the Securities of the Company held indematerialized mode with them for year 2020-21.

Share Capital

During the year under review there is no any change made in share capital of theCompany.

Electronic Voting

Your Company has entered into an agreement with NSDL for providing facility of e-votingto its shareholders Now Shareholders can avail the facility of remote e-voting to itsshareholders for casting their vote electronically if required.

Internal Financial Control and their adequacy

The details in respect of internal financial control and their adequacy are included inthe Management Discussion and Analysis which is a part of this report.

Corporate Governance

The Equity Shares of the Company are listed on the SME platform (NSE-emerge) of NSELimited. Regulation 27 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 relating to Corporate Governance is not applicable to the Company listedon the SME platform (NSE-emerge) of NSE. Hence the Company is not required to discloseinformation as covered under Para (C) (D) and (E) of Schedule V of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.

Reserve

The Company has a Closing Balance of Rs. 175648712/- (Rupees Seventeen Crore FiftySix Lac Forty Eight Thousand Seven Hundred Twelve Only) as Reserve and Surplus as on31/03/2019.

The Closing Balance of Reserves and Surplus is bifurcated as follows:

Sr. No. Particulars Amount (In Rs.)
1. Balance at the beginning of the year 153671869/-
2. Current Year's Profit 23743242/-
3. Addition of Amount of Securities Premium during period/year -
4. Interim Dividend Paid 1766399/-
Total 175648712/-

Dividend

For Financial Year 2019-20 based on the Company's performance the Directors havedeclared and paid interim dividends of Rs. 0.20 per equity share of Face Value Rs. 10each to the members of the Company. The amount of total dividend on equity sharesincluding dividend tax for Financial Year 2019-20 would aggregate Rs. 1766399/-resulting in a dividend pay-out of 100% of the unconsolidated profits of the Company.Company confirmed that Company has paid dividend to all members of the Company.

Material changes and commitment if any affecting the financial position of the Companyoccurred between the end of the financial year to which this financial statements relateand the date of the Report:

No material changes and commitments affecting the financial position of the Companyhave been occurred between the end of the financial year to which this financial statementrelate and the date of the report except COVID-19 pandemic mentioned above in the BoardReport.

Transfer to Investor Education and Protection Fund

Pursuant to Section 125(2) of the Companies Act 2013 it is required to transfer theamount of dividend remaining unpaid or unclaimed for a period of seven years to theInvestor Education and Protection Fund (“IEPF”). During the year under reviewthere was no unpaid or unclaimed dividend amount having in the “Unpaid DividendAccount” for a period of 7 years from the date of transfer of such unpaid dividend tothe said account. Therefore there were no funds which were required to be transferred toInvestor Education and Protection Fund.

Conservation of energy Technology absorption Foreign exchange earnings and outgo

The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act pursuant to Section134(3)(m) of the Companies Act 2013 read with the Rule 8(3) of the Companies (Accounts)Rules 2014 is given as an ‘Annexure III' to this Report.

Statement concerning development and implementation of Risk Management Policy of theCompany

The Company has in place a mechanism to identify access monitor and mitigate variousrisks towards the key business objectives of the Company. Major risk identified by thebusiness and functions are systematically addressed through mitigating actions on acontinuing basis.

Details of Policy Developed and Implemented by the Company on its Corporate SocialResponsibility Initiatives

The Company has not developed and implemented any Corporate Social Responsibilityinitiatives as the said provisions are not applicable on your Company for the financialyear ended March 31 2020 as per Section 135(1) of the Companies Act 2013 and rules madethere-under.

Directors and Key Managerial Personnel

In accordance with the provision of Section 152 of the Companies Act 2013 at theensuing Annual General Meeting (AGM) Mr. Minku Shantilal Gandhi (DIN: 00118617) retiresby rotation and being eligible offers himself for re-appointment. The notice conveningthe AGM includes the proposal for his re-appointment as director.

There was no change in the Directors and Key Managerial Personnel of the Company duringthe financial year 2019-20.

The Board Comprise of the following:

Sr. No. Name of Director Designation DIN
1. Shantilal Bhailal Gandhi Chairman and Executive Director 00118509
2. Minku Shantibhai Gandhi Joint Managing Director 00118617
3. Maunal Shantilal Gandhi Joint Managing Director 00118559
4. Shailesh Indradaman Patwari Independent Director 00411439
5. Purvi Tapan Trivedi Independent Director 08064080
6. Hanisha Jinish Patel Independent Director 07190911
7. Pradip Bhadriklal Parikh Chief Financial Officer -
8. Archita Jitendrakumar Shah Company Secretary -

However after the closure of the Financial year 2019-20 Mr. Shantilal BhailalbhaiGandhi (DIN: 00118509) gave his resignation from the post of Chairman and Director due tohis advancing age with effect from close of business hours of May 30 2020.

Declaration by Independent Directors

The following directors have been appointed as independent directors in terms ofSection 149(6) of the Act;

1. Mr. Shailesh Indradaman Patwari 2. Mrs. Purvi Tapan Trivedi 3. Mrs. Hanisha JinishPatel

The Company has received requisite declarations/ confirmations from all the aboveDirectors confirming their independence.

Annual Evaluation by the Board

Pursuant to the provision of Companies Act 2013 Rules made thereunder and as perpolicy of the Company Separate meeting of independent directors was held to evaluate theperformance of non-independent directors performance of the board as a whole andperformance of the chairman taking into account the views of executive directors andnon-executive directors. Performance evaluation of independent directors was done by theentire board excluding the independent director being evaluated.

Evaluation of the performance of the board its committees and individual directors hasbeen carried out after taking into consideration attendance contribution remunerationand other criteria as recommended by the Nomination and Remuneration Committee of theCompany and reviewed by the Nomination and Remuneration Committee too.

All Directors of the company were satisfied with the evaluation process and itsoutcome.

Subsidiaries Joint Ventures and Associate Companies

The Company has 01 subsidiary as on March 31 2020. There are no associate or jointventure companies within the meaning of Section 2(6) of the Companies Act 2013(“Act”).

On October 23 2019 Company has incorporated its wholly owned subsidiary with the nameand style of M/s. UC Colours and Intermediates Private Limited. As on December 26 2019Due to sale and transfer of its 10% shares it becomes subsidiary of the Company.

Pursuant to the provisions of Section 129(3) of the Act a statement containing thesalient features of financial statements of the Company's subsidiaries in Form No. AOC-1is given as an ‘Annexure IV' to this Report.

Financial accounts of subsidiary company for the financial year 2019-20 are availablefor inspection by any Member at the Registered Office of your Company during normalbusiness hours on all working days up to the date of the Annual General Meeting of theCompany a copy of which can also be sought by any Member on making a written request tothe Secretarial Department of your Company in this regard.

Further pursuant to the provisions of Section 136 of the Act the financial statementsof the Company consolidated financial statements along with relevant documents andseparate audited financial statement in respect of subsidiary is available on the websiteof the Company www.ushanti.com.

Performance / Highlights of the Subsidiary Company

Directors of the Company glad to inform you that company will commence its operationsoon.

Deposits

Your Company has neither accepted nor renewed any deposits during the year within themeaning of Section 73 of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014.

Pursuant to the provisions of Rule 2(1)(c)(viii) of the Companies (Acceptance ofDeposits) Rules 2014 Company has accepted Rs. 81784285/- during the FY 19-20 from theDirectors of the Company.

Auditor and Auditor's Report

Statutory Auditors

On 26th Annual General Meeting held on September 28 2019 M/s. ANA & AssociatesChartered Accountants Ahmedabad has been appointed as Statutory Auditors of your Companyfor five years from the conclusion of the 26th Annual General Meeting held on September28 2019 till the conclusion of the 31st Annual General Meeting.

On December 04 2019 M/s. ANA & Associates Chartered Accountants Ahmedabad (FRN:130797W) has been merged with the firm M/s. DJNV & Co. Chartered Accountants (FRN:115145W) and the said letter to that effect was received by the Company on December 052019. Accordingly the Audit Committee and Board of Directors of the company in theirmeeting held on January 13 2020 took note of the same and recommended for noting andapproval of the shareholders of the company for the Change in the name of StatutoryAuditor Firm due to merger and appointment of M/s. DJNV & Co. Chartered Accountants(FRN: 115145W) on the same terms and conditions including remuneration for the remainingtenure for which M/s. ANA & Associates Chartered Accountants Ahmedabad (FRN:130797W) was appointed by the shareholders of the Company. The resolution for taking noteof name change of Statutory Auditor Firm has been included in the Notice of Annual GeneralMeeting.

Cost Auditors

Provision of Cost Audit is not applicable on your Company. Accordingly your Company isnot required to conduct the cost audit for the financial year ended March 31 2020.

Secretarial Auditors

The Board appointed M/s. Hudda and Associates Company Secretaries LLP Ahmedabad toconduct Secretarial Audit of the company for the financial year 2019-20 The Reportpertains to Section 204 of the Companies Act 2013 and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is given as an ‘Annexure V' to thisReport.

The Auditors Report is annexed with the Annual Report of the Company. The observationmade by Auditors in their Report your Directors wish to state that the report is self -explanatory and do not require any further clarification from the Board.

Internal Auditors

During the year under the preview As per section 138 of the Companies Act 2013 &Rules framed thereunder and based on recommendation of the Audit Committee of yourCompany the Board of Directors of your Company has appointed Mrs. Mital Dipeshbhai Shahas Internal Auditor of the Company for the financial year 2019-20.

Committees of the Board

As Company is listed on EMERGE Platform of National Stock Exchange of India LimitedHence Company required to constitute various committees as per applicable provisions ofCompanies Act 2013 and SEBI (Listing and Obligation Disclosure Requirement) Regulations2015.

Presently the board has Three (3) committees i.e. Audit Committee Nomination andRemuneration Committees Stakeholders Relationship Committee constitution of which aregiven below.

A) Composition of Audit Committee:

The Board of Directors constituted an Audit Committee in compliance with the provisionof Section 177 of the Companies Act 2013. During the year under review Audit Committeemet 9 (Nine) times viz 03rd April 2019 27th May 2019 27th August 2019 17th October2019 23rd October 2019 19th December 2019 23rd December 2019 13th January 2020 and06th February 2020. The composition of the Committee and the details of meetings attendedby its members are given below:

Name Status No. of Committee Meeting entitled No. of Committee Meeting attended
Mr. Shailesh Indradaman Patwari Chairman 9 8
Mrs. Hanisha Jinish Patel Member 9 9

 

Mr. Maunal Shantilal Gandhi Member 9 9

Recommendations of Audit Committee wherever/whenever given have been accepted by theBoard.

B) Composition of Nomination and Remuneration Committee:

The Board of Directors constituted Nomination and Remuneration Committee in compliancewith the provision of Section 178 of the Companies Act 2013.

During the year under review Nomination and Remuneration Committee met 4 (Four) timesviz 03rd April 2019 27th August 2019 06th February 2020 and 21st March 2020. Thecomposition of the Committee and the details of meetings attended by its members are givenbelow:

Name Status No. of Committee Meeting entitled No. of Committee Meeting attended
Mrs. Hanisha Jinish Patel Chairman 4 4
Mr. Shailesh Indradaman Patwari Member 4 4
Mrs. Purvi Tapan Trivedi Member 4 4

The term of reference of Nomination & Remuneration Committee is as below:

1. Formulation of the criteria for determining qualifications positiveattributes and independence of a director and recommend to the Board a policy relating tothe level and composition of remuneration of the directors key managerial personnel andother employees;

2. Formulation of criteria for evaluation of independent directors and theBoard;

3. To ensure that the relationship of remuneration to performance is clear andmeets appropriate performance benchmarks;

4. Devising a policy on Board diversity; and

5. Identifying persons who are qualified to become directors and who may beappointed in senior management in accordance with the criteria laid down and recommend tothe Board their appointment and removal.

The Policy of Nomination and Remuneration Committee has been placed before Website ofthe Company at www.ushanti.com and the same has been also disclosed under ‘AnnexureVI'.

C) Stake Holder's Relationship Committee:

The Board of Directors constituted Stake Holder's Relationship Committee in compliancewith the provision of Section 178 of the Companies Act 2013.

During the year under review Stake Holder's Relationship Committee met 4 (Four) timesviz 27th May 2019 27th August 2019 23rd October 2019 and 10th January 2020. Thecomposition of the Committee and the details of meetings attended by its members are givenbelow:

Name Status No. of Committee Meeting entitled No. of Committee Meeting attended
Mrs. Purvi Tapan Trivedi Chairman 4 4
Mr. Shailesh Indradaman Patwari Member 4 3
Mrs. Hanisha Jinish Patel Member 4 4

During the year the Company had not received any complaints from the Shareholders.There was no complaint pending as on March 31 2020.

Insurance

All the assets of your Company including buildings machineries fixtures other fixedassets stocks-raw materials WIP finished goods etc. have been adequately insured.

Significant and Material Orders Passed by the Regulators or Courts or Tribunals

There has been no significant and material order passed by any regulators or courts ortribunals impacting the going concern status of the Company and its future operations.

However the Company has entered into settlement agreement with Gujarat IndustrialDevelopment Corporation (GIDC) and Vatva Industrial Estate Infrastructure DevelopmentLimited SPV of Vatva Industries Association for resolving the matter which had been listedon High Court Gujarat (Case No.: 13194/2018) for the matter of disconnection of watersupply on Plot No. 88/6 and 88/7 G I D C Phase I Vatva Ahmedabad-382445 GujaratIndia and due to entering into settlement agreement Company has closed the said casewhich has been listed on High Court Gujarat. Further there were no any penalty/fine hasbeen paid by Company and nothing has been changed/impacted on financial position of theCompany. Subsequently GIDC and VIA have restored connections in the above mentioned plotsand company will be saving money used to buy water.

Reporting of Fraud

The Auditors of the Company have not reported any fraud as specified under Section143(12) of the Companies Act 2013.

Vigil Mechanism / Whistle Blower Policy

The Company has established a vigil mechanism and accordingly framed a Whistle BlowerPolicy. The policy enables directors and employees to disclose their concerns andgrievances on Unethical Behaviour and Improper/Illegal Practices and Wrongful Conducttaking place in the Company for appropriate action. Through this Policy the Companyprovides necessary safeguards to all such persons for making sheltered disclosures in goodfaith.

The Vigil Mechanism team was framed by Board in its Board Meeting held on 27thApril 2018 and it comprises of the following:

Sr. No. Name Status
1. Mr. Maunal Shantilal Gandhi Vigilant Officer
2. Mr. Shailesh Indradaman Patwari Member
3. Mrs. Hanisha Jinish Patel Member

During the year under review no any grievances received by company. The VigilMechanism is available on the website of the Company at www.ushanti.com.

Disclosures under Sexual Harassment of women at workplace (Prevention Prohibition& Redressal) Act 2013

The Company has always been committed to provide a safe and conducive work environmentto its employees. Your Directors further states that during the year under review therewere no cases filed pursuant to the Sexual Harassment of women at workplace (PreventionProhibition & Redressal) Act 2013.

Particulars of Employees

Disclosures with respect to remuneration of employees as per Section 197 of theCompanies Act 2013 read with Rule 5(1) & 5(2)** of Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 for the year ended 31st March 2020 isgiven as an ‘Annexure VII' to this Report.

There are no employees who are posted outside India and in receipt of a remuneration ofRs. 60.00 lakh or more per annum or Rs. 5.00 lakh or more a month.

**During the year under review there are no employees who received remuneration of Rs.10200000/- per annum or Rs. 850000/- per month during the year hence the Company isnot require to give disclosure as per Rule 5(2) of Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 List of top ten employees and details thereofmentioned in the annexure.

Management and Discussion Analysis

Management and Discussion Analysis Report as an integral part of this Report requiredto give under Regulation 34 and Schedule V of the SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 is mentioned as an ‘Annexure VIII' to this report.

Related Party Disclosure

Related Party disclosure as mentioned in Schedule V of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is appended to the report of Director herewithattached as ‘Annexure IX' to this report.

Industrial Relations

During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.

Policy on Director Appointment and Remuneration

As per provision of Section 178 of the Companies Act 2013 Company prepared policy onDirectors' appointment and remuneration including criteria for determining qualificationspositive attributes independence of a Director and other matters provided under section178(3) of the Companies Act 2013.

The policy itself drives the remuneration criteria which depends upon performance andis reasonable and sufficient to attract retain and motivate director for running companysmoothly. The remuneration and sitting fees paid by the Company are within the salaryscale approved by the Board and Shareholders.

Acknowledgement

Your Directors place on record their sincere thanks to bankers business associatesconsultants and various Government Authorities for their continued support extended toyour Company's activities during the year under review.

Form No. MGT-9

Extract of Annual Return as on the Financial Year Ended on 31/03/2020

[Pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of the Companies(Management and Administration) Rules 2014]

I. REGISTRATION AND OTHER DETAILS:

i. CIN L24231GJ1993PLC019444
ii. Registration Date 12/05/1993
iii. Name of the Company Ushanti Colour Chem Limited
iv. Category / Sub-Category of the Company Company limited by Shares/ Non-govt company
v. Address of the Registered office and contact details 88/8 G I D C Phase I Vatva Ahmedabad-382445 Gujarat India
Contact No.: 079-25833315
Email Id: csucl@ushanti.com admin@ushanti.com
vi. Whether listed company Yes
EMERGE Platform of National Stock Exchange of India Limited
vii. Name Address and Contact details of Registrar and M/s. Bigshare Services Private Limited
Transfer Agent if any (CIN: U99999MH1994PTC076534)
Address: 1st Floor Bharat Tin Works Building Opp. Vasant
Oasis Makwana Road Marol Andheri East Mumbai- 400059
Maharashtra India
Email ID: ipo@bigshareonline.com

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10 % or more of the total turnover of thecompany shall be stated:-

Sr. No. Name and Description of main products / services NIC Code of the Product/ service % to total turnover of the company
1 Manufacture of dyes (includes manufacture of such dyes and colouring matters which are for final use by household/industrial/institutional consumers manufacture of special dyes used in laboratories e.g. to colour microscopic preparations is also included) 24114 100

III. PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES

Sr. No. Name And Address Of The Company CIN/GLN Holding/ Subsidiary /Associate % of shares held Applicable Section
1. UC Colours and Intermediates Private Limited Address: 88/8GIDC Phase I Vatva Ahmedabad-382445 Gujarat India U24100GJ2019PTC110467 Subsidiary 90 2(87)

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

I. Category-wise Share Holding

No. of Shares held at the beginning of the year

No. of Shares held at the end of the year
Category of Shareholders Demat Physical Total % of Total Shares Demat Physical Total % of Total Shares % Change during the year
A. Promoter
1) Indian
a) Individual/ HUF 2714854 0 2714854 37.18 2714854 0 2714854 37.18 0
b) Central Govt 0 0 0 0 0 0 0 0 0
c) State Govt(s) 0 0 0 0 0 0 0 0 0
d) Bodies Corp 0 0 0 0 0 0 0 0 0
e) Banks / FI 0 0 0 0 0 0 0 0 0
f) Any Other
(i)Group Companies 0 0 0 0 0 0 0 0 0
(ii) Trusts 0 0 0 0 0 0 0 0 0
(iii) Directors Relatives 2712846 0 2712846 37.15 2712846 0 2712846 37.15 0
5427700 0 5427700 74.33 5427700 0 5427700 74.33 0
Sub-total(A)(1):-
2) Foreign
g) NRIs-Individuals 0 0 0 0 0 0 0 0 0
h) Other-Individuals 0 0 0 0 0 0 0 0 0
i) Bodies Corp. 0 0 0 0 0 0 0 0 0
j) Banks / FI 0 0 0 0 0 0 0 0 0
k) Any Other…. 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0
Sub-total (A)(2):-
Total Promoter 5427700 0 5427700 74.33 5427700 0 5427700 74.33 0
Shareholding
(A)=(A)(1)+ (A)(2)
B. Public Shareholding
1. Institutions
a) Mutual Funds 0 0 0 0 0 0 0 0 0
b) Banks / FI 0 0 0 0 0 0 0 0 0
c) Central Govt 0 0 0 0 0 0 0 0 0
d) State Govt(s) 0 0 0 0 0 0 0 0 0
e) Venture Capital Funds 0 0 0 0 0 0 0 0 0
f) Insurance Companies 0 0 0 0 0 0 0 0 0
g) FIIs 0 0 0 0 0 0 0 0 0
h) Foreign Venture 0 0 0 0 0 0 0 0 0
Capital Funds
i) Others (specify) 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0
Sub-total (B)(1)
2. Non Institutions
a) Bodies Corp. 206000 0 206000 2.82 198000 0 198000 2.71 (0.11)

 

(i) Indian
(ii) Overseas
b) Individuals
(i) Individual shareholders holding nominal share capital upto Rs. 1 lakh 563670 0 563670 7.72 554000 0 554000 7.59 (0.13)
(ii) Individual shareholders holding nominal share capital in excess of Rs 1 lakh 802000 0 802000 10.98 864000 0 864000 11.83 0.85
c) Others(Specify)
(i) Trusts 0 0 0 0 0 0 0 0 0
(ii) Clearing Member 48344 0 48344 0.66 2000 0 2000 0.03 (0.63)
(iii) Non Resident Indians (NRI) 4000 0 4000 0.05 2000 0 2000 0.03 (0.03)
(iv) Directors Relatives 0 0 0 0 0 0 0 0 0
(v) Overseas Bodies Corporates 0 0 0 0 0 0 0 0 0
(vi) Unclaimed Suspense Account 0 0 0 0 0 0 0 0 0
(vii) Hindu Undivided 249986 0 249986 3.42 254000 0 254000 3.48 0.05
Family
d) Qualified Foreign 0 0 0 0 0 0 0 0 0
Investor 1874000 0 1874000 25.67 1874000 0 1874000 25.67 25.67
Sub-total (B)(2) 1874000 0 1874000 25.67 1874000 0 1874000 25.67 0
Total Public Shareholding (B)=(B)(1)+ (B)(2)
C. Shares held by Custodian for GDRs & ADRs 0 0 0 0 0 0 0 0 0
Grand Total (A+B+C) 7301700 0 7301700 100 7301700 0 7301700 100 0

ii. Shareholding of Promoters

Shareholding at the beginning of

Shareholding at the end of the year

Sr. No

Shareholder's Name

No. of Shares the year % of total Shares of the company %of Shares Pledged / encumbe red total shares No. of Shares % of total Shares of the company %of Shares Pledged / encumbered to total shares % change in shareholding during the year

 

1. Shantilal Bhailal Gandhi 1710247 23.42 0 1710247 23.42 0 0
2. Minku Shantilal Gandhi 1359427 18.62 0 1359427 18.62 0 0
3. Maunal Shantilal Gandhi 1355427 18.56 0 1355427 18.56 0 0
4. Mona Maunal Gandhi 481250 6.59 0 481250 6.59 0 0
5. Shefali Minku Gandhi 481250 6.59 0 481250 6.59 0 0
6. Shantilal Bhailal Gandhi HUF 40011 0.55 0 40011 0.55 0 0
7. Minku Shantilal Gandhi HUF 33 0.0004 0 33 0.0004 0 0
8. Maunal Shantilal Gandhi HUF 44 0.0006 0 44 0.0006 0 0
9. Aadit Minku 11 0.0001 0 11 0.0001 0 0
Gandhi
Total 5427700 74.33 0 5427700 74.33 0 0

iii. Change in Promoters' Shareholding (please specify if there is no change)

Shareholding at the beginning of the year

Cumulative Shareholding during the year

Sr. no Shareholder's Name No. of Shares % of total Shares of the company No. of Shares % of total Shares of the company
1. Shantilal Bhailal Gandhi
At the Beginning of the year 1710247 23.42 1710247 23.42
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 1710247 23.42 1710247 23.42
2. Minku Shantilal Gandhi
At the Beginning of the year 1359427 18.62 1359427 18.62
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 1359427 18.62 1359427 18.62
3. Maunal Shantilal Gandhi
At the Beginning of the year 1355427 18.56 1355427 18.56
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 1355427 18.56 1355427 18.56
4. Mona Maunal Gandhi

 

At the Beginning of the year 481250 6.59 481250 6.59
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 481250 6.59 481250 6.59
5. Shefali Minku Gandhi
At the Beginning of the year 481250 6.59 481250 6.59
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 481250 6.59 481250 6.59
6. Shantilal Bhailal Gandhi HUF
At the Beginning of the year 40011 0.55 40011 0.55
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 40011 0.55 40011 0.55
7. Minku Shantilal Gandhi HUF
At the Beginning of the year 33 0.0004 33 0.0004
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 33 0.0004 33 0.0004
8. Maunal Shantilal Gandhi HUF
At the Beginning of the year 44 0.0006 44 0.0006
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 44 0.0006 44 0.0006
9. Aadit Minku Gandhi
At the Beginning of the year 11 0.0001 11 0.0001
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 11 0.0001 11 0.0001

iv. Shareholding Pattern of Top Ten Shareholders (Other than Directors Promoters andHolders of GDRs and ADRs)

Sr. no Shareholder's Name Shareholding at the beginning of the year No. of Shares % of total Shares of the company Cumulative Shareholding during the year No. of Shares % of total Shares of the company

 

1. Yash Chemex Limited
At the Beginning of the year 144000 1.97 144000 1.97
Date Reason for Increase or Decrease
Allotment- IPO Allotment
Bonus
Sweat
12/04/2019 Other Transfer 14000 0.19 158000 2.16
At the end of the year 158000 2.16 158000 2.16
2. Piyush Jashwantlal Shah
At the Beginning of the year 96000 1.31 96000 1.31
Date Reason for Increase or Decrease -
Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 96000 1.31 96000 1.31
3. Pritesh Y Shah (HUF)
At the Beginning of the year 96000 1.31 96000 1.31
Date Reason for Increase or Decrease -
Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 96000 1.31 96000 1.31
4. Amishi Piyush Shah
At the Beginning of the year 76000 1.04 76000 1.04
Date Reason for Increase or Decrease -
Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 76000 1.04 76000 1.04
5. Jignesh Shashikant Desai
At the Beginning of the year 70000 0.96 70000 0.96
Date Reason for Increase or Decrease
Allotment- IPO Allotment
Bonus
Sweat
12/04/2019 Other Transfer 6000 0.8 76000 1.04
At the end of the year 76000 1.04 76000 1.04
6. Surendra Nandlal Shah
At the Beginning of the year 66000 0.90 66000 0.90
Date Reason for Increase or Decrease -
Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 66000 0.90 66000 0.90
7. Pinesh Vaghjibhai Shah
At the Beginning of the year 54000 0.74 54000 0.74
Date Reason for Increase or Decrease -

 

Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 54000 0.74 54000 0.74
8. Mukesh Pramodray Dave
At the Beginning of the year 54000 0.74 54000 0.74
Date Reason for Increase or Decrease -
Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 54000 0.74 54000 0.74
9. Vipulkumar Utsavlal Kanunga
At the Beginning of the year 62000 0.85 62000 0.85
Date Reason for Increase or Decrease -
Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 62000 0.85 62000 0.85
10. Shailesh M Patel
At the Beginning of the year 52000 0.71 52000 0.71
Date Reason for Increase or Decrease
Allotment- IPO Allotment
Bonus
Sweat
Other Transfer
At the end of the year 52000 0.71 52000 0.71

v. Shareholding of Directors and Key Managerial Personnel

Sr. no

Shareholding at the beginning of the year

Cumulative Shareholding during the year

Shareholder's Name No. of Shares % of total Shares of the company No. of Shares % of total Shares of the company
1. Shantilal Bhailal Gandhi
At the Beginning of the year 1710247 23.42 1710247 23.42
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 1710247 23.42 1710247 23.42
2. Minku Shantilal Gandhi
At the Beginning of the year 1359427 18.62 1359427 18.62
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 1359427 18.62 1359427 18.62

 

3. Maunal Shantilal Gandhi
At the Beginning of the year 1355427 18.56 1355427 18.56
Date Reason for Increase or Decrease -
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 1355427 18.56 1355427 18.56
4. Shailesh Indradaman Patwari
At the Beginning of the year 0 0 0 0
Date Reason for Increase or Decrease
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 0 0 0 0
5. Hanisha Jinish Patel
At the Beginning of the year 0 0 0 0
Date Reason for Increase or Decrease
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 0 0 0 0
6. Purvi Tapan Trivedi
At the Beginning of the year 0 0 0 0
Date Reason for Increase or Decrease
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 0 0 0 0
6. Pradip Bhadriklal Parikh
At the Beginning of the year 0 0 0 0
Date Reason for Increase or Decrease
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 0 0 0 0
7. Archita Jitendrakumar Shah
At the Beginning of the year 0 0 0 0
Date Reason for Increase or Decrease
Allotment
Bonus
Sweat
Other Transfer
At the end of the year 0 0 0 0

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due forpayment

Secured Loans excluding deposits Unsecured Loans Deposits Total Indebtedness
Indebtedness at the beginning of the financial year
i) Principal Amount 72911312.00 21289588.00 - 94200900.00
ii) Interest due but not paid - 3323955.00 - 3323955.00
iii) Interest accrued but not due 122563.00 - - 122563.00
Total (i+ii+iii) 73033875.00 24613543.00 - 97647418.00
Change in Indebtedness during the financial year
- Addition - 85429928.00 - 85429928.00
- Reduction (10345564.00) (67062580.00) - -77408144.00
Net Change (10345564.00) 18367348.00 - 8021784.00
Indebtedness at the end of the financial year
i) Principal Amount 62588924.00 39690776.00 - 102279700.00
ii) Interest due but not paid - 3290114.00 - 3290114.00
iii) Interest accrued but not due 99387.00 - - 99387.00
Total (i+ii+iii) 62688311.00 42980890.00 - 105669201.00

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director Whole-time Directors and/or Manager

Sl. No. Particulars of Remuneration Name of MD/WTD/ Manager
Mr. Minku Shantilal Gandhi- Joint Managing Director Mr. Maunal Shantilal Gandhi- Joint Managing Director Mr. Shantilal Bhailal Gandhi- Chairman and Executive Director Total Amount
1. Gross salary Rs. Rs. Rs. Rs.
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act 1961 6000000/- 6000000/- 3600000/- 15600000/-
(b) Value of perquisites u/s 17(2) Income-tax Act 1961
(c) Profits in lieu of salary under section 17(3) Income- tax Act 1961
2. Stock Option
3. Sweat Equity
4. Commission

 

- as % of profit
- others specify…
5. Others please specify
1. PF Contribution Rs. 720000/- Rs. 720000/- - Rs.
1440000/-
6. Total (A) Rs. 6720000/- Rs. 6720000/- Rs. 3600000 Rs.
17040000/-
Ceiling as per the Act

As per Schedule V of the Companies Act 2013

B. Remuneration to other directors:

Sl. No. Particulars of Remuneration Name of MD/WTD/ Manager Total Amount
Independent Directors
Fee for attending board committee meetings
Commission
Others please specify
Total (1)
Other Non-Executive Directors
Fee for attending board committee meetings N.A.
Commission
Others please specify
Total (2)
Total (B)=(1+2)
Total Managerial Remuneration
Overall Ceiling as per the Act

Company has not appointed any director as Non-executive Director and not paid any feesto Independent Directors.

C. Remuneration to Key Managerial Personnel Other Than MD /Manager /WTD

Key Managerial Personnel

Sl. no. Particulars of Remuneration CEO Company Secretary CFO Total
1. Gross salary N.A.
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act 1961 Rs. 295294/- Rs. 770669/- Rs. 1065963/-
(b) Value of perquisites u/s 17(2) Income-tax Act 1961
(c) Profits in lieu of salary under section 17(3) Income-tax Act 1961

 

2. Stock Option
3. Sweat Equity
4. Commission
- as % of profit
- others specify…
5. Others please specify
1. PF Contribution Rs. 4226/- - Rs. 4226/-
2. Gratuity Accrued for the year (Payable at Retirement / resignation) Rs. 1663/- Rs. 7656/- Rs. 9319/-
- Rs. 25000/- Rs. 25000/-
3. Incentive (Product Incentive)
4. ESI Rs. 5043/- - Rs. 5043/-
5. Professional Tax Rs. 2156/- Rs. 2406/- Rs. 4562/-
6. Total Rs. 308382/- Rs. 805731/- Rs. 1114113/-

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:

Type Section of the companies Act Brief description Details of Penalty/ Punishment/ Compounding fees imposed Authority[RD /NCLT/Court] Appeal made. If any(give details)
A. Company
Penalty
Punishment N.A.
Compounding
B. Directors
Penalty
Punishment N.A.
Compounding
C. Other Officers In Default
Penalty
Punishment N.A.
Compounding

.