VADILAL ENTERPRISES LIMITED
Your Directors have pleasure in presenting herewith the 36th Annual Reporttogether with the Audited Statement for the year ended on 31st March 2021.
(Rs. in Lacs)
|Particulars ||Current Year ended on 31-03-2021 ||Previous Year ended on 31-03-2020 |
|(a) Earnings before Interest Tax Depreciation and Amortization ||1933.13 ||1650.65 |
|(b) Finance Cost ||(482.99) ||(312.42) |
|(c) Depreciation & Amortization Expense ||(1327.35) ||(1386.29) |
|(d) Profit/(Loss) before Tax ||122.79 ||(48.06) |
|(e) Tax Expense || || |
|-- Current Tax ||53.72 ||72.77 |
|-- Deferred Tax Expenses ||(16.30) ||(38.03) |
|Total Tax: ||37.42 ||34.74 |
|(f) Profit/(Loss) for the year ||85.37 ||(82.80) |
|(g) Other Comprehensive income || || |
|Item that will not be reclassified to Profit & Loss || || |
|- Re-measurement of Defined Benefit Plans (Net of Taxes) ||2.38 ||(23.68) |
|(i) Total Comprehensive income for the year ||87.75 ||(106.48) |
STATE OF COMPANYS AFFAIRS:
The Company has earned Revenue from Operations of Rs. 34015.15 lacs during the yearended on 31st March 2021 as against Rs. 59150.57 lacs earned during theprevious year ended on 31st March 2020 giving a fall of 42.49% as compared toprevious year.
After adding thereto the other income of Rs. 377.87 lakhs earned by the Company theCompany has earned total income of Rs. 34393.02 lakhs during the year under review. TheCompany has incurred total expenses of Rs. 34270.23 lakhs including Finance cost of Rs.482.99 lakhs and Depreciation and Amortization expenses of Rs. 1327.35 lakhs during theyear under review.
The Company has incurred profit before Tax of Rs. 122.79 lacs during the year underreview as compared to loss of Rs. 48.06 lacs incurred during the previous year ended on 31stMarch 2020.
To conserve resources of the company considering the situation arising due to COVID-19pandemic your Directors do not recommend any dividend for the year under review.
TRANSFER TO RESERVES:
The Company has not transferred any amount to General Reserve during the year underreview.
MANAGEMENT DISCUSSION & ANALYSIS:
To ensure maximum visibility in terms of marketing we spend on an optimal mix of abovethe line (ATL) and bellow the line (BTL) activities. We utilize various communicationtouch points like TV Print Digital Retail activity Point of purchase (POP) Point ofSales (POS) etc. to get the brand message across. All of the above makes Vadilal thelargest marketing investment company in Ice cream segment in competition with othersplayers.
However the advertising budgets are skewed more towards television as we have anationwide reach now. Apart from traditional media platforms we also enjoy commendablebrand presence and preference in the digital space that cater to the youth and all classand society. this year we spearheaded social media led campaigns to engage with the youngconsumer.
On the sales promotions front we constantly engage our trade patrons through variousschemes and offers. Vadilal also invests in consumer promotional activities from time totime. We are expecting to yield good results this year as we have been very calculative inpumping our assets into the market for the expansion of our business.
We are marching towards Rs.1000 crores INR sales turnover by 2023 with strategicbusiness planning & product innovation with extensive distribution with completemarketing efforts. Yet the overall vision of the company remains the same that is toincrease the consumption of ice-cream at the national level supported by appropriatepromotion and communication strategies.
Vadilal with its decades of expertise and experience the ever-enhancing businessstrategies and a bold approach towards competition will keep supplying momentum to thebrands growth in the years to come.
During the year under review the company has been sanctioned & disbursed CovidEmergency Credit Line (CECL) from Bank of India amounting to Rs. 1.00 Crore and executedwith bank on 06.06.2020. Apart from it bank has also sanctioned Guaranteed EmergencyCredit Line 1.0 (GECL 1.0) from Bank of India for Rs. 2.63 Crore and executed with bank on04.05.2021. Apart from above Interest & Installment on working capital and term loanfacilities has been paid to Bank / Fis as availed by the Company.
India Ratings & Research Pvt. Ltd. has rated the Term Loan borrowing of the companyas BBB/ Negative Fund-Based Bank facilities as BBB/ Negative/IND A3+ and Non-Fund-BasedBank facilities as A3+.
IMPACT OF COVID_19 ON THE FINANCE:
Due to Corona virus and multiple lock down in the country our business module andbusiness cycle has been badly affected in FY 2020-21. Company could not liquidate stock asper normal business cycle. Hence Sales & Profit was under pressure.
INVESTOR EDUCATION AND PROTECTION FUND:
During the financial year 2020-2021 the Company has deposited unclaimed/ unpaiddividend amount for the FY 2012-13 of Rs. 46961/- to Investor Education and ProtectionFund - IEPF.
During the year under review the Company has transferred the unclaimed interest onFixed Deposit of Rs. 1615/- to Investors Education and Protection Fund.
DETAILS OF DEPOSITS: a. During the year under review the details of depositsaccepted by the Company from its Members after complying with the provisions of Section73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules2014 are as under :
| ||( Rs. in lakhs) |
|(a) Amount of existing deposits as at 1st April 2020 : ||44.20 |
|(b) Amount of deposits accepted or renewed during the year || |
|(i) Secured deposits : ||0 |
|(ii) Unsecured deposits : ||0 |
|Total (b) : : ||0 |
|(c) Amount of deposits repaid during the year : ||16.20 |
|(d) Balance of deposits outstanding at the end of the year (a+b-c) ||28.00 |
b. During the year under review the Company has not made any default in repayment ofdeposits or payment of interest on deposits. c. The Company has not accepted or renewedany deposit which is not in compliance with the provisions of Chapter V of theCompanies Act 2013.
CONSOLIDATED FINANCIAL STATEMENTS:
As on 31st March 2021 the Company does not have any subsidiary jointventure or associate Company and hence the Company is not required to attach theConsolidated Financial Statements alongwith its Financial Statement in terms ofprovisions of Section 129(3) read with Schedule III of the Companies Act 2013 andRules made thereunder and Regulation 34 of the SEBI (Listing Obligation and DisclosureRequirement) 2015 and other applicable Accounting Standards.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES:
As on 31st March 2021 the Company does not have any subsidiary jointventure or associate company. Therefore Report on the performance and financial positionof each of the subsidiaries associates and joint venture companies is not require to begiven. During the year under review none of the companies have become or ceased to beCompanys subsidiaries associates or joint ventures.
The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relatingto Meetings of the Board of Directors and General Meetingsrespectively have been duly followed by the Company.
The provisions related to compliance with Corporate Governance of as mentioned inRegulation 16(2) of Chapter IV of the SEBI (Listing Obligation and DisclosureRequirement) Regulations 2015 ("SEBI-LODR") are not applicable to the Companysince the share capital of the company does not exceed Rs. 10.00 Crores and the net-worthof the Company does not exceed Rs. 25 Crores as per the last audited Balance sheet of theCompany.
However being a Listed Company the Company has always taken necessary measures toadhere to the best governance practices and norms.
DIRECTORS RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the confirmation andexplanations obtained by them your Directors make the following statement in terms ofSection 134(3)(C) and 134(5) of the Companies Act 2013 and confirm :
(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(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 at the end of the financial year and ofthe profit and loss of the company for that period;
(c) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this 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 provisionsof all applicable laws and that such systems were adequate and operating effectively.
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED:
Particulars of loans given investments made guarantees given and securities providedby the Company under Section 186 of the Companies Act 2013 forms part of the Notes to thefinancial statements provided in this Annual Report.
EXTRACT OF ANNUAL RETURN:
Pursuant to section 92(3) of the Companies Act 2013 and Rule 12 of the Companies(Management and Administration) Rules 2014 the Annual Return for FY 2020-21 is availableon companys website at https://vadilalgroup.com/?page_id=944
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:
Information on transactions with related parties pursuant to Section 134(3)(h) of theAct read with Rule 8(2) of the Companies (Accounts) Rules 2014 are given inAnnexure A in the prescribed Form AOC-2 and the same forms part of thisreport. All related party transactions are placed before the Audit Committee and the Boardof the Company for review and approval.
The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Companys website viz.www.vadilalgroup.com.
Your Directors draw attention of the members to Note 40 to the financialstatement which sets out related party transactions.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
As on 31st March 2021 the Board of the Company comprises the followingDirectors:
|Name of the Director ||Designation ||Category |
|1. Mr. Rajesh R. Gandhi ||Chairman & Director ||Non-executive and Non-Independent |
|2. Mr. Devanshu L. Gandhi ||Director ||Non-executive and Non-Independent |
|3. Mrs. Mamta R. Gandhi ||Director ||Non-executive and Non-Independent |
|4. Mr. Ashish H. Modi ||Director ||Independent Director |
|5. Mr. Chetan Tamboli ||Director ||Independent Director |
Mr. Preet Shah ceased to be Director of the Company w.e.f. 01.10.2020 due tocompletion of his term as an independent director of the company.
Mr. Chetan Tamboli is appointed as an independent director of the Company w.e.f.30.09.2020 As on 31st March 2021 the Key Managerial personal of the Companyare as follows:
|Name of the Key Managerial Personal ||Designation |
|1. Mr. Kamal Varma ||Chief Executive Officer |
|2. Mr. Ranveersinh Raol (w.e.f. 20.11.2020) ||Chief Executive Officer |
|3. Mr. Rajesh Bhagat ||Chief Financial Officer |
|4. Mr. Darshan Shah ||Company Secretary & Compliance Officer |
Pursuant to the provisions of Section 152 of the Companies Act 2013 and Rules madethereunder Mr. Devanshu Gandhi Director (DIN: 00010146) of the Company shall retire byrotation at this Annual General Meeting and being eligible offers him for re-appointment.The Members are requested to consider her re-appointment as Director of the Company forwhich necessary resolution has been incorporated in the notice of the meeting.
The brief resume/details relating to Mr. Devanshu Gandhi is furnished in the Notice ofthe Annual General Meeting.
During the year Mr. Jinand Patel resigned from the post of Chief Executive Officers ofthe company w.e.f. 29th October 2020. Mr. Ranveersinh Raol was appointed asChief Executive Officers of the company w.e.f. 20th November 2020 Mr. DarshanShah Company Secretary and Compliance officer of the Company resigned from the post w.e.f.7th July 2021 and Mr. Vishal K Sondagar has been appointed as CompanySecretary and Compliance Officer of the Company with effect from 15.07.2021.
NUMBER OF BOARD MEETINGS:
Total 8 meetings of the Board of Directors (Including Adjourned) were held during theyear details of dates and their attendance is as follows: Board meeting were held on01-05-2020 26-06-2020 10-08-2020 13-08-2020 27-08-2020 09-11-2020 11-02-2021 and31-03-2021
|Name of Director ||Attendance Particulars (Total 8 Board Meetings held during the year) |
|Mr. Rajesh R. Gandhi ||8 |
|Mr. Devanshu L. Gandhi ||7 |
|Mrs. Mamta R. Gandhi ||8 |
|Mr. Ashish H. Modi ||7 |
|Mr. Preet P. Shah* ||4 |
|Mr. Chetan Tamboli** ||2 |
*Mr. Preet Shah ceased to be Director of the Company w.e.f. 01.10.2020 due tocompletion of his term as an independent director of the company; he was eligible toattend 5 meetings.
**Mr. Chetan Tamboli is appointed as an independent director of the Company w.e.f.30.09.2020. He was eligible to attend 3 meetings.
COMMITTEES OF DIRECTORS:
The details of various committees of Directors constituted under various provisions ofCompanies Act 2013 and Rules made thereunder are as follows:
A. AUDIT COMMITTEE:
The Audit Committee comprises the following Director of the Company as on 31stMarch 2021 namely:
|Name of the Member ||Designation ||Category |
|1 Mr. Chetan Tamboli ||- Chairman ||Independent Director |
|2 Mr. Rajesh R. Gandhi ||- Member ||Non-Executive and Non-Independent Director |
|3 Mr. Ashish Modi ||- Member ||Independent Director |
Audit Committee meetings were held on 26-06-2020 10-08-2020 13-08-2020 09-11-2020and 11-02-2021
The constitution of the Audit Committee fulfills the requirements of Section 177 of theCompanies Act 2013 and Rules made thereunder. The members of audit committee arefinancially literate and having accounting or related financial management expertise.
Mr. Darshan Shah Company Secretary of the Company was the Secretary to the AuditCommittee.
B. NOMINATION AND REMUNERATION COMMITTEE:
The Nomination and Remuneration Committee of the Company comprises the followingDirectors of the Company as on 31st March 2021 namely:
|Name of the Member ||Designation ||Category |
|1 Mr. Chetan Tamboli ||- Chairman ||Independent Director |
|2 Mr. Devanshu L. Gandhi ||- Member ||Non-executive and Non-Independent Director |
|3 Mr. Rajesh R. Gandhi ||- Member ||Non-executive and Non-Independent Director |
|4 Mr. Ashish Modi ||- Member ||Independent Director |
The constitution of Nomination and Remuneration Committee fulfills the requirements ofSection 178 of the Companies Act 2013 and Rules made thereunder.
Nomination and Remuneration Committee meetings were held on 10-08-2020 13-08-202027-08-2020 09-11-2020 and 11-02-2021
C. STAKEHOLDERS RELATIONSHIP COMMITTEE:
The Stakeholders Relationship Committee of the Company comprises the followingDirectors of the Company as on 31st March 2021 namely:
|Name of the Member ||Designation ||Category |
|1 Mr. Rajesh R. Gandhi ||- Chairman ||Non-Executive and Non-Independent Director |
|2 Mr. Devanshu L. Gandhi ||- Member ||Non-Executive and Non-Independent Director |
|3 Mr. Chetan Tamboli ||- Member ||Independent Director |
The constitution of Stakeholders Relationship Committee fulfills the requirementsof Section 178 of the Companies Act 2013 and Rules made thereunder.
The Committee inter alia approves the transfer of Shares issue of duplicate ShareCertificates splitting and consolidation of Shares etc. The Committee also looks afterredressal of Shareholders complaints like transfer of shares non-receipt of balancesheet non-receipt of dividends etc. The Board of Directors has delegated the power ofapproving transfer of Shares etc. to the Stakeholders Relationship Committee.
Stakeholders relationship Committee meeting was held on 20-12-2020 20-01-2021and 30-01-2021
BOARD PERFORMANCE EVALUATION:
The board of directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed under Regulation 17 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
The performance of the Board and committees were evaluated by the Board on the basis ofthe criteria determined by Nomination and Remuneration Committee such as the Boardcomposition and structure effectiveness of board processes information and functioningetc.
The Board reviewed the performance of the individual directors on the basis of thecriteria such as the contribution of the individual director to the Board and committeemeetings like preparedness on the issues to be discussed meaningful and constructivecontribution and inputs in meetings etc.
In a separate meeting of independent Directors performance of non-independentdirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting of theindependent Directors at which the performance of the Board its committees andindividual directors was also discussed.
OTHER POLICIES AS PER THE REQUIREMENT OF COMPANIES ACT 2013 AND SEBI (LISTINGOBLIGATION AND DISCLOSURE REQUIREMENT) 2015
The policies formulated by the Company under various provisions of Companies Act 2013and SEBI (Listing Obligation and Disclosure Requirement) 2015 are available on thewebsite of the Company viz : www.vadilalgroup.com.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The details of Conservation of Energy and Technology Absorption are not required toprovide as the provisions of Section 134(1)(m) are not applicable to the Company due tothe nature of the Companys business operations being Marketing Company.
There is no any Foreign Exchange Earnings or outgo during the year under review.
INTERNAL FINANCIAL CONTROLS
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The External and Internal Auditors carryout periodic reviewsof the functioning and suggest changes if required. The company has also a soundbudgetary control system with frequent reviews of actual performance as against thosebudgeted.
The Statutory Auditors have given the qualified opinion on the financial reporting intheir Report with regards to assessment and closure of the various financial operationaland governance related matters emanating out of the allegations made by promoter directorsagainst each other and their consequential impact if any on the standalone financialstatements of the Company The Management does not expect any material impact on thefinancial statements of the Company considering the fact that the matters pertain toearlier financial years and amount as already been expensed in the relevant financialyears. Voluntary inquiries by external agencies initiated by the management are in processto substantiate its conclusion.
Board of Directors in its meeting held on 13th August 2020 approved andrecommended appointment of M/s. Arpit Patel & Associates as a Statutory Auditors ofthe company for a period of 5 years i.e. till the conclusion of the 40th AnnualGeneral Meeting of the Company to be held in the year 2025 subject to approval ofshareholders in this annual general meeting; which shareholder has in its meeting held on30.09.2020 approved.
On the basis of passing of above resolution M/s. Arpit Patel & Associates willcontinue as a Statutory Auditors of the company till the of the conclusion of 40thAnnual General Meeting of the Company to be held in the year 2025.
AUDITORS REPORT OF THE COMPANY:
The Independent Auditors Report dated 30th June 2021 for theFinancial Results of the Company for the year ended on 31st March 2021contains qualified Opinion together with the basis for the same made by the Auditors: TheManagement does not expect any material impact on the financial statements of the Companyconsidering the fact that the amount has already been expensed in the relevant financialyears. Voluntary inquiries by external agencies initiated by the management are in processto substantiate its conclusion.
Section 204 of the Companies Act 2013 inter alia requires every listed companies toannex with its Board Report a Secretarial Audit Report given by a Company Secretary inpractice in the prescribed form. The Board has appointed M/s SPAN & Co. CompanySecretaries LLP to conduct Secretarial Audit for the financial year 2020-2021. TheSecretarial Audit Report for the financial year ended March 31 2021 is annexed herewithmarked as Annexure B to this Report.
The Secretarial Auditors Report of the Company for the year ended 31stMarch 2021 contains certain Comments/ observations. The explanation on observationstherein is as under: -
1. As required under Regulation 31(2) of LODR Regulations hundred percent shareholdingof the promoters and promoter group is not maintained in dematerialized form: Promotersare in the process of dematerialization of shares of the Company.
2. There was a delay in disclosure of revision in credit ratings by CARE and IND-RA toBSE as required under Regulation 30(6) of LODR Regulations: The Company has intimated thestock exchange about the credit rating within 24 hours of receipt of ratings from therating agencies.
The maintenance of cost records has not been specified by Central Government undersection 148(1) of the Companies Act 2013 for the business categories in which Companyoperates accordingly such accounts and records are not maintained.
PARTICULARS OF EMPLOYEES:
The Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are enclosed with this report as Annexure - C. TheStatement of particulars of employees under Section 197(12) read with Rule 5 (2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isnot required to be provided since during the financial year under review no employee ofthe Company except the Managing Directors was in receipt of remuneration in excess of thelimits set out in the said rules.
A Company Petition (being Company Petition No. 42 of 2017) has been filed against theCompany before the National Company Law Tribunal Ahmedabad ("NCLT") underSections 241 and 242 of the Companies Act 2013. In connection to the said CompanyPetition No. 42 of 2017 the case has been heard on 27th July 2021 and thematter has been adjourned to 4th October 2021.
IMPECT OF COVID_19 ON COMPANY
Outbreak of COVID-19 pandemic globally and in India has impacted significantly thebusiness of the company during the year. Company has witnessed lower revenues due to lockdown imposed during the beginning of the year being the peak period of the Ice creambusiness. With the unlocking of restrictions business improved gradually in the last twomonths of the year. Whilst there has been a second wave of Covid 19 Pandemic in April andMay 2021 the domestic Ice cream business of the company once again got impacted beingthe peak period. The management will continuously monitor for any material changes to thefuture economic conditions.
All insurable interests of the Company including buildings plant and machineryfurniture & fixtures and other insurable interest are adequately insured.
O During the year under review there was no change in the nature of business ofthe Company and there is no material change and/or commitments affecting the financialposition of the Company during the period from 31st March 2021 till the dateof this report.
O During the year under review there was no significant and/or material orderpassed by any regulators or courts or tribunals impacting the going concern status andcompanys operations in future.
O The Company does not provide any loan or other financial arrangement to itsemployees or Directors or Key Managerial Personnel for purchase of its own shares andhence the disclosure under Section 67(3)(c) of the Companies Act 2013 does not require.
O During the year under review no Director or Managing Director of the Company hasreceived any remuneration or commission from subsidiary of the Company in terms ofprovisions of Section 197(14) of the Companies Act 2013.
O The disclosure in terms of Rule 4 of Companies (Share Capital andDebenture) Rules 2014 is not provided as the Company does not have any equity shareswith differential voting rights.
O The Company has zero tolerance towards sexual harassment at the workplace and hasadopted a policy on prevention prohibition and redressal of sexual harassment atworkplace in line with the provisions of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the Rules made thereunder.
The Board desires to place on record its appreciation of the support and co-operationthat your Company received from Distributors Dealers Stockiest C&F AgentsRetailers and all others associated with your Company. It will be your Companyscontinued endeavor to build and nurture strong links with the trade based on mutualityrespect and co-operation and consistent with the consumer interest.
The Directors place on record the appreciation and gratitude for the co-operation andassistance extended by various departments of the Union Government State GovernmentBankers and Financial Institutions.
The Directors also place on record their appreciation of dedicated and sincere servicesof the employees of the Company at all levels. The Company will make every effort to meetthe aspirations of its Shareholders and wish to sincerely thank them for theirwhole-hearted co-operation and support at all times.
| ||By Order of the Board of Directors |
| ||RAJESH R. GANDHI ||DEVANSHU L. GANDHI |
|Date : 13th August 2021 ||CHAIRMAN & DIRECTOR ||DIRECTOR |
|Place : Ahmedabad ||DIN : 00009879 ||DIN : 00010146 |