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Vikas Ecotech Ltd.

BSE: 530961 Sector: Industrials
BSE 00:00 | 02 Dec 4.70 -0.24






NSE 00:00 | 02 Dec 4.75 -0.20






OPEN 4.70
VOLUME 853411
52-Week high 11.59
52-Week low 0.96
Mkt Cap.(Rs cr) 132
Buy Price 4.70
Buy Qty 24688.00
Sell Price 4.70
Sell Qty 111537.00
OPEN 4.70
CLOSE 4.94
VOLUME 853411
52-Week high 11.59
52-Week low 0.96
Mkt Cap.(Rs cr) 132
Buy Price 4.70
Buy Qty 24688.00
Sell Price 4.70
Sell Qty 111537.00

Vikas Ecotech Ltd. (VIKASECO) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting the 34th Annual Report of the Company andAudited Financial Statements for the year ended 31st March 2019.


The financial performance of theCompany for the year 2018.

(Rupees in Lac)
Particulars 2018-2019 2017-2018
Net Sales /Income from Business Operations 24525.04 23617.75
Other Income 2451.86 403.96
Total Income 26976.90 24021.71
Cost of material consumed 20983.74 16905.81
Employee Benefit Expense 407.03 447.91
Financial Costs 1579.28 1079.18
Other Expenses 1210.62 1104.70
Profit before Depreciation 2796.22 4484.11
Less Depreciation 476.91 359.84
Net Profit Before Tax 2319.32 4124.28
Less Current Tax 595.11 1402.81
Less Previous year adjustment of Income Tax 13.29
Less Deferred Tax 86.60 34.72
Profit for the Period 1637.61 2673.46

The financial statements for the year ended 31st March 2019 have been prepared inaccordance with the Indian Accounting Standards (Ind AS) as notifiedby the Ministry ofCorporate Affairs. There is a marginal increase in Sales from 236.17 Crores in previousyear to 245.25 Crores in current year however there has been a decline in profits of theCompany i.e. from 26.73 Crore in previous year to 16.37 Crores in current year. Thedemerger of ‘Recycled and Trading Compounds Division' of the Company was successfullycompleted during the year under review and the Shareholders of the Company were allottedshares in ratio of 1:1 of Vikas Multicorp Limited (Resultant Company) acquiring the saiddivision for each share of the Company held. Presently your Company is operating inremaining segments. The Company is now concentrating on its core business components i.e.the specialty chemicals and compounds. The Financial Statements have been prepared aftertaking effect of said demerger.

No material changes / commitments affecting financial position of the Company haveoccurred from end of the financial year to the date of this report.


During fiscal 2019 while the Company continued to augment its turnover however itsprofit margins have been under some stress due to high volatility in raw materials interms of fluctuations in both prices and Forex which further resulted in continued highworking capital costs. Despite all the odds and challenging situations trailing oneanother the Company has achieved a stable growth in terms of turnover and a profitablefinancial year.

During the year under review:

• The Company completed commercial scale productiontrials and the added capacityof Specialty Chemicals plant at Rajasthan is ready for utilization in anticipation ofenhancedproductionand sales for the next fiscal year as well.

• The Company successfully designed & tried the new range of Eco-friendlyCalcium Zinc Heat Stabilizer for PVC across various application areas like the PVC Rigid& Soft PVC Applications which have been included in the list with this new addition tothe product mix offered by VEL. VEL is ready to start commercial scale production inanticipation of the huge demand that will be created with the implementation of the ban onToxic Stabilizers.

The lag in raw materials & production due to disruptions based on the Directorateof Revenue Intelligence Survey as reported in the previous annual report is getting betterand the operations are getting back on track. We hope that the effect in terms of the lossof optimum production shall be covered over the next 6 months.


As anticipated targeted & projected for the FDA approved - Food Contact SafeOrganotin Stabilizers for which your Company is the only producer in India and one of thevery few across the globe the Company has successfully initiated the process for tappingthe potential embedded in the largest market place for the Organotin Stabilizers theU.S.A. & has been received well by the market due to its consistent quality of thematerials.

The Company is working towards exceeding the projected vitals for the Organotinbusiness in the year 2019-20. During the first half of the current financial year weanticipate that the exports to the U.S.A. would exceed the targeted 300 MT and the annualtarget of 1000 MT for Organotin business is also expected to be marginally exceeded forthe year.

The Company is expecting to grow this product with pace & poise to effectively tapthe business opportunity. Organotin as promising at it seemed a few years back will bethe driving force for the Company in achieving the planned projections for the specialtychemicals is accelerating in the direction towards accomplishment of the similarfuturistic & promising business ideas including the cPVC.


In terms of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 (‘Listing Regulations') Management Discussion and Analysis report( "MD&AReport") providing a detailed overview of your Company's performance industrytrends business and risks involved is provided separately and is forming part of theAnnual Report.


Your Company does not have a subsidiary joint venture or associates hence reportingrequirements are not applicable.


Your Directors recommend payment of Dividend @5% of i.e. Rs. 0.05 (five paisa) perequity share of Re. 1/- each. Dividend if approved by the Members of the Company at theensuing Annual General Meeting shall be payable on the outstanding equity share capitalas at the Record Date i.e. 20th September 2019. The outflow on account aggregates to Rs.16923411/-. of equity dividend and the tax on dividend distribution


Governance is not an action but a continuous endeavor which reflects Organization. YourCompany strongly believes in developing best corporate governance policies and proceduresbased on principals of fair and transparent disclosures equity accountability andresponsibility.

A detailed report on Corporate Governance in terms of Regulation 34 of the ListingRegulations is forming part of the Annual Report. A certificate confirming compliance withrequirements of Corporate Governance as enumerated under the extant provisions of ListingRegulations issued by Ms. Teena Rani Partner MSTR & Associates Company Secretariesis also annexed to the said report.


As a corporate citizen your Company takes pride in its Corporate Social Responsibility(CSR) and sustainability initiatives and practices. The Company has duly constituted aCommittee under the nomenclature of Corporate Social Responsibility Committee consistingof majority of non-executive independent Directors. The Committee has developed CorporateSocial Responsibility Policy of the Company and is monitoring implementation of the same.The CSR Committee reports to the Board. The said CSR policy of the Company is alsoavailable on the Website of the Company at During the year underreview the Company undertook CSR initiative for the cause of Education through "St.Kabir Educational Society" aggregating to Rs. 9000000/-. TheAnnualReportonCompany'sCSRactivities is attached to this report.


The Board of Directors provide strategic direction and supervision to an organization.Your Company's Board consists of learned professionals and experienced individuals fromdifferent fields. Presently your Board comprises of Seven Directors of whom two areexecutive one is non-executive and four are Independent Directors including one womenDirector. The Board met 4 (four) times during the yeardetailspertainingto Board andCommittee Meetings held during the year are detailed in Corporate Governance Report.

Mr. Ravi Kumar Gupta and Mr. Gyan Prakash Govil were inducted in the Board asAdditional Directors under category of Independent Directors of the Company by the Boardw.e.f. 14th February 2019 and 28th June 2019 respectively. Being additionalDirectorsthey shall vacate office at the commencement of ensuing Annual General Meeting. Your Boardhas recommended their appointment as Independent Directors and your approval is beingsought as part of business to be transacted at the Meeting.

Mr. Devender Kumar Garg Wholetime Director retires by rotation at the ensuing AnnualGeneral Meeting and being eligible has offered himself for re-appointment. Disclosures interms of Regulation 36 of Listing Regulations and Secretarial Standards on General Meetingare forming part of AGM Notice in respect of Directors proposed to be appointed /re-appointed.

Mr. Ashutosh Kumar Verma Wholetime Director and Chief Executive Officer of the Companyresigned with effect from 28th June 2019. Mr. Madan Mohan Mandal and Mr. Manoj SinghalIndependent Directors of the Company also resigned from the Directorship citing theirpersonal reasons on 8th October 2018 and 5th July 2019 respectively. The Board isgrateful for their support and places on record its appreciation for the responsibilitiesshouldered by them in their respective roles.


The Independent Directors have confirmed that they meet the criteria of Independence asstipulated under Section 149(6) of the Companies Act 2013 read with the Regulation 16 (1)(c) of the Listing Regulations and they are not aware of any circumstances or situationwhich exist or may be reasonably anticipated that could impair or impact their ability todischarge their duties with an objective independent judgment and without any externalinfluence as an Independent Director of the Company. The Board conforms to the declarationof the Independent Directors and there being no doubts as to veracity of the same placesthe same on record.


In compliance with the requirements of Companies Act 2013 and Listing Regulations yourBoard had constituted various Board Committees including Audit Committee Nomination &Remuneration Committee Stakeholders Relationship Committee and Corporate SocialResponsibility Committee. Details of the constitution of these Committees which are inaccordance with regulatory requirements have been uploaded on the website of the Companyviz. Details of scope constitution terms of reference number ofmeetings held during the year under review along with attendance of Committee Members areprovided under Corporate Governance Report forming part of the Annual Report.


In line with the statutory requirements enshrined under the Companies Act 2013 and theListing Regulations the Board carried out a performance evaluation of itself itsCommittees the Chairman and each of the other Directors. The performance evaluation wascarried out on the basis of framework approved by the Nomination and RemunerationCommittee. The Committee had unanimously consented for an ‘in-house' review built onsuggestive parameters. Based on the suggestive parameters approved by the Nomination andRemuneration Committee the following evaluations were carried out: Review of performanceof the non- independent Directors and Board as a whole by Independent Directors. Review ofthe performance of the Chairperson by the Independent Directors. Review of Board as awhole by all the Members of the Board. Review of all Board Committees by all the Membersof the Board. Review of Individual Directors by rest of the Board Members except theDirector being evaluated.


Apart from executive Directors your Company has following key managerial personnel:

Chief Executive Officer

Consequent to resignation of Mr. Ashutosh Kumar Verma Whole time Director and ChiefExecutive Officerof the Company Mr. Dinesh Bhardwaj has been appointed as a non-directorChief Executive Officerof the effective 28 th June 2019.

Chief Financial Officer

Officerof your Company effective 30 Mr.AmitDhuriahasbeenappointed and continuing thMay 2018.

Company Secretary

Mr. Siddharth Aggarwal resigned from officeofCompanySecretaryandComplianceOfficeron 21st December 2018. Ms. Preeti Rai was thereafter appointed as Compliance Officereffective22 nd December 2018 and also as Company Secretary w.e.f. 14th February 2018.however she tendered her resignation effective 3 rd August 2019. Your Board hasconsidered and approved appointment of Ms. Pooja Vanjani as Company Secretary andCompliance Officer w.e.f. 19th August 2019.


Statutory Audit

M/s KSMC & Associates Chartered Accountants are Statutory Auditors of the Companypursuant to Members' approval obtained at the 31st Annual General Meeting held on 30thSeptember 2016. Their term of appointment is five years and accordingly they shall holdofficetill conclusion of the 36 th Annual General Meeting of the Company. The financialresults of the Company are subject to limited and Company's financial statements areaudited on annual basis. There are no qualifications reservationsor adverse remarks inthe Report issued by M/s KSMC & Associates Statutory Auditors for the financial yearended 31 st March 2019. The Statutory Auditors have also not reported any incident offraud to the Audit Committee during the year under review. Remarks made in the Auditors'are self-explanatory and do not call for any further comments from your Directors.

Secretarial Audit and Secretarial Compliance Report

M/s. MSTR & Associates Company Secretaries were appointed as the SecretarialAuditors of your Company to carry out the Secretarial Audit for the financial SecretarialAuditors in Form No. MR-3 is annexed with this Report. There are no the Secretarial AuditReport requiring any comments from your Directors.

In terms of extant provisions of Listing Regulations read with SEBI circulars issued onthe subject a Secretarial Compliance Report was also obtained by the Company from theSecretarial Auditors and the same was also intimated to the Stock Exchange. There are noqualifications or reservations in the said report and the same is also attached with theSecretarial Audit report.

Cost Audit

As per the extant provisions of Section 148 of the Companies Act 2013 the costrecords for the products requiring cost audit has been maintained by the Company in atimely and proper manner the same was also made available to the Cost Auditors of theCompany for their audit. M/s. JSN & Co. Cost Accountants were engaged to carry outAudit of Cost Records of the Company during Financial Year 2018-19.

Requisite proposal for approval of the Members seeking ratification of remunerationpayable to the Cost Auditor for FY 2018-19 forms part of the Notice of the Annual General


Pursuant to Section 134(3) (c) of the Companies Act 2013 the Directors to the best oftheir knowledge hereby state and confirm that:

a) The Financial Statements of the Company - comprising of the Balance Sheet as at 31stMarch 2019 and the Statement of Profit & Loss for the year ended on that date havebeen prepared on a going concern basis;

b) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures; themconsistently and made judgments and

c) thedirectorshadselectedsuchaccounting estimates that are reasonable and prudent soas to give a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit of the company for that period;

d) the directors had taken proper and sufficient care for the maintenance of adequateaccounting accordance with the provisions of this Act for safeguarding the assets of thecompany and for preventing and irregularities; detectingfraudandother

e) the internal financial controls to be followed by the company were laid down andsuch internal financial controls were adequate and were operating effectively; and

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


The Board of Directors of the Company has established a Policy on Vigil Mechanism forthe Directors and Employees of the Company to report their genuine concerns or grievancesrelating to actual or suspected fraud unethical behavior violation of the Company's Codeof Conduct or Ethics Policy and any other event which would adversely affect theinterests of the business of the Company. Direct access is provided to the whistle blowersto reach Chairman of the Audit Committee on reporting issues concerning the interests ofco-employees and the Company. The Company has alsoprovidedadequatesafeguardsagainstvictimization of employees and directors who expresstheir concerns. The copy of Company's vigil mechanism is available at the website of theCompany


Your Company believes in principles of gender equality and endeavors to provide ahealthy and respectable work environment. It has developed a framework for employees toreport sexual harassment cases at workplace and its process ensures complete anonymity andconfidentialityof information. During the year under review no complaints of any event /occurrence of an act of sexual harassment was reported / noticedby the management.


Your Company follows the practice of undertaking related party transactions only in theordinary and normal course of business and at arm's length basis as part of its philosophyof adhering to highest ethical standards transparency and accountability. In line withthe provisions of the Companies Act 2013 and the Listing Regulations The same isavailable on the Company's website theBoardhasapprovedapolicyonrelatedparty transactions.

Omnibus approval of the Audit Committee and the Board is obtained for the transactionswhich are of a foreseeable and repetitive nature in all other cases prior approval ofAudit Committee is taken for entering into a related party transaction. All Related PartyTransactions are placed on a quarterly basis before the Audit Committee and before theBoard for their review.

During the year no material contracts / contracts or arrangements with related partiesnon in Ordinary course of business or on arm's length basis were entered hence noreporting under Form AOC-2 is required. Details of related party transactions are providedunder notestofinancialstatements.


The Audit Committee and Board periodically reviews adequacy of Company's checks andcontrols for risk management. The Board has developed a Risk Management Policy whichidentifieselements of business & other risks involved and constantly works towardscurbing the same. Adequacy of internal financial controls with reference to the FinancialStatements is also assessed and reviewed periodically. Your Board is of the view that theexisting internal control framework is adequate and commensurate to the size and nature ofthe business of the Company.

In addition testing of adequacy of internal controls was also carried outindependently by the Statutory Auditors of the Company.


Details of Significant and Material Orders Passed by the regulators/Courts/Tribunalsimpacting the Going Concern Status and the Company's OperationsinFuture

There are no significant and material orders passed by the Regulators/Courts/Tribunalswhich would impact the going concern status of the Company and its future operations.

A certificate confirming that none of the Directors of the Company have beendisqualified for appointment as such under the extant provisions of Companies Act 2013and Listing Regulations issued by Ms. Teena Rani Partner MSTR & Associates CompanySecretaries is also annexed to the Corporate Governance Report. Particulars RegardingConservation of Energy and Research and Development and Technology Absorption

Details of steps taken by your Company to conserve energy through its"Sustainability" initiatives Research and Development and Technology Absorptionhave been disclosed as part of the Annual Report.

Remuneration of Directors Key Managerial Personnel and Particulars of Employees

197(12) of the Act read Disclosurespertaining to remunerationand other details asrequired under Section with Rule 5(1) of the Companies (Appointment andRemunerationofManagerial Personnel) Rules 2014 are forming part of the Annual Report.

Annual Return

Annual Return pursuant to Section for the year ended 31 st March 2019 has been placedon the website of the Company at .

Particulars of Loans Guarantees or Investments

Interms of Section investments are of inter-corporate loans guarantees and provided inthe notes to Financial Statements.


The Company has neither accepted any deposits during the year under review nor has anyoutstanding deposits from any of earlier years for repayment.

Secretarial Standards

During the year under review the Company has complied with all applicable SecretarialStandards issued by Institute of Company Secretaries of India.

Remuneration Policy

The Company has a remuneration policy which provides for basis for fixation ofremuneration of Directors Key Managerial Personnel and Senior Management Officials of theCompany. The remuneration policy of the Company is largely based on factors likehierarchy industry practices and performance of respective individuals. The policy isavailable on the website of the Company at . shareholderssuppliers bankers business partners/ TheBoardexpressesits associates financialinstitutions and Central and State Governments for their consistent support andencouragement to the Company and its sincere appreciation to all the employees of theCompany for their hard work and commitment. Their dedication and competence has ensuredthat the Company continues to be a significant and leading player in theindustry.Welookforwardtocontinuedsupportfrom all ends.

For and on behalf of Board
For Vikas EcoTech Limited
Sd/- Sd/-
Sumer Chand Tayal Vikas Garg
(Director) (Managing Director)
DIN: 00255661 DIN: 00255413
Place: New Delhi
Date: 14.08.2019