TO THE MEMBERS OF MANGALAM ORGANICS LIMITED
Your Directors have pleasure in presenting the Fortieth Annual Report
on the performance of the Company together with the audited financial statements for the
Financial Year ('FY') ended March 31, 2022.
FINANCIAL RESULTS
The financial performance of your Company for the year ended March 31,
2022 is summarized below:
(Rs in Lakhs)
| Particulars |
Standalone |
Consolidated |
| FY 2021-22 |
FY 2020-21 |
FY 2021-22 |
FY 2020-21 |
| Revenue from Operations |
49091.50 |
33,826.46 |
49064.87 |
33,823.67 |
| Other Income |
144.18 |
104.90 |
144.18 |
104.90 |
| Total Revenue |
49235.69 |
33,931.36 |
49209.05 |
33,928.57 |
| Profit before Depreciation and Finance cost |
9264.48 |
12,892.48 |
9242.55 |
12,883.58 |
| Depreciation and Amortization expense |
1491.29 |
1,353.43 |
1501.92 |
1,353.43 |
| Finance Cost |
388.61 |
100.18 |
419.73 |
100.18 |
| Profit after Depreciation, Finance costs and
Exceptional items and before Tax |
7384.58 |
11,438.87 |
7320.89 |
11,429.97 |
| Tax expense |
1955.30 |
2,952.08 |
1946.57 |
2,952.08 |
| Profit After Tax |
5429.28 |
8,486.79 |
5374.32 |
8,477.89 |
| Other comprehensive income |
(6.18) |
(14.71) |
(6.17) |
(14.71) |
| Total Comprehensive Income for the Year |
5423.10 |
8,472.08 |
5368.15 |
8,463.18 |
NATURE OF BUSINESS AND FINANCIAL PERFORMANCE
Your Company is engaged in the business of manufacturing chemical and
has Terpenes and Synthetic Resins as primary segment, which falls under a single segment
of chemicals. Your Company has achieved Net Sales Turnover of Rs. 490.92 Crore with a
Profit after Tax (PAT) of Rs. 54.23 Crore during FY 2021-22 as compared to Rs. 338.26
Crore and Rs. 84.72 Crore, respectively, during FY 2020-21 signifying a growth of 45.13 %
in turnover. However there has been decline of 36 % on PAT. Approximately 80% of the
revenue has come from Terpenes Chemicals. There was no change in nature of the business of
the Company, during the year under review.
DIVIDEND
The Directors are pleased to recommend a dividend of Rs. 1.50 per
equity share of the face value of Rs. 10/- each for the year ended March 31, 2022
(previous year: Rs. 1.50 per Equity Share). The dividend, as recommended by the Board, if
declared at the ensuing Annual General Meeting ('AGM') will be paid to those members whose
names appear in the Register of Members at the end of business hours on September 21,
2022. In respect of shares held in dematerialized form, the dividend will be paid on the
basis of beneficial ownership, as per the details to be furnished for the purpose by
National Securities Depository Limited (NSDL) and Central Depository Services (India)
Limited (CDSL) as at the end of business hours on September 21, 2022.
UNCLAIMED AND UNPAID DIVIDEND AND TRANSFER OF SHARES TO IEPF
As on March 31, 2022 amount of Rs. 13,33,915/-, comprising of Rs.
4,15,285/-, Rs. 2,71,435/-, Rs. 2,66,381/- and Rs.3,80,814/- are lying in the unpaid
equity dividend account of the Company in respect of the dividends for FY 2020-21, FY
2019-20, FY 2018-19 and F.Y. 2017-18 respectively. Members who have not yet received/
claimed their dividend entitlements are requested to contact the Company or the Registrar
and Transfer Agents of the Company. The list of such shareholders for unpaid and unclaimed
dividend for FY 2020-21, FY 2019-20 and FY 2018-19 is placed on the Company's website
www.mangalamorganics.com.
Pursuant Section 124 of the Companies Act, 2013 read with the Investor
Education Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016
("Rules"), all dividends remaining unpaid or unclaimed for a period of seven
years and also the shares in respect of which the dividend has not been claimed by the
shareholders for seven consecutive years or more are required to be transferred to
Investor Education Protection Fund in accordance with the procedure prescribed in the
Rules.
In this regard, all dividends remaining unpaid or unclaimed for a
period of seven years and also the shares in respect of which the dividend have not been
claimed by the shareholders for seven consecutive years for FY 2010-11 have been
transferred to Investor Education Protection Fund (IEPF) account on November 2, 2018 and
February 15, 2019 respectively. The members can claim the transfer of such shares from
IEPF in accordance with the procedure and on submission of the documents as prescribed
from time to time. The list of such shareholders whose shares and dividend has been
transferred to IEPF is placed on the Company's website www. mangalamorganics.com.
TRANSFER TO RESERVE
The Board of Directors has decided to retain the entire amount of
profits for FY 2021-22 in the Retained Earnings.
SHARE CAPITAL
During the year under review, there was no change in the share capital
of the Company. As on March 31, 2022, the paid up share capital of the Company was Rs.
8,56,44,400 divided into 85,64,440 Equity of the face value of Rs. 10/- each.
DEPOSITS
During the year under review, your Company neither accepted any
deposits nor there were any amounts outstanding at the beginning of the year which were
classified as 'Deposits' in terms of Section 73 of the Companies Act, 2013 read with the
Companies (Acceptance of Deposit) Rules, 2014.
SUBSIDIARY/ JOINT VENTURES/ ASSOCIATES COMPANIES
During the year under review:
• Two new companies viz. 'Mangalam Pooja Stores Private Limited'
and 'Mangalam Speciality Chemicals Private Limited' were incorporated as Wholly Owned
Subsidiaries ('WOS') of the Company.
• The name of one WOS of the company was changed from 'Campure
Private Limited' to 'Mangalam Brands Private Limited'.
The performance and financial position of the subsidiaries of the
Company for the year ended March 31, 2022 is attached to the financial statements hereto.
In accordance with Section 129(3) of the Companies Act, 2013, a
statement containing salient features of the financial statements of the subsidiary
company in Form AOC-1 is provided as Annexure- 1 to the Board's Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Board of Directors and Key Managerial Personnel
The Board of Directors of the Company comprises 6 (Six) Directors. Out
of the said Directors, 4 (Four) are Independent Directors including a Woman Director and 2
(Two) are Executive Directors.
There were no changes in the composition of Board of Directors and the
Key Managerial Personnel during the year under review.
As on the date of this report, the Company has following Key Managerial
Personnel:
1. Mr. Kamalkumar Dujodwala, Executive Director
2. Mr. Pannkaj Dujodwala, Managing Director
3. Mr. Sanjay Bhardwaj, Chief Executive Officer
4. Mr. Shrirang V. Rajule, Chief Financial Officer
5. Ms. Shachi Sanghavi, Company Secretary & Compliance Officer
In accordance with the provisions of Section 152 read with Section
149(13) of the Companies Act, 2013, Mr. Kamalkumar Dujodwala is liable to retire by
rotation. The said Director has offered himself for reappointment and resolution for his
reappointment is incorporated in the Notice of the ensuing Annual General Meeting.
Declarations by Independent Directors
Pursuant to the provisions of sub-section (7) of Section 149 of the
Companies Act, 2013, the Company has received declarations from all the Independent
Directors confirming that they fulfill the criteria of independence as specified in
Section 149(6) of the Companies Act, 2013 read with Regulation 17(10) of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as
'SEBI Listing Regulations').
Annual Evaluation of Directors, Committee and Board
The Board of Directors has carried out an annual evaluation of its own
performance, board committees, and individual directors pursuant to the provisions of the
Act and SEBI Listing Regulations. The performance evaluation was carried out by way of
obtaining feedback from the Directors through a structured questionnaire prepared in
accordance with the policy adopted by the Board and also taking into consideration the
Guidance Note on Board Evaluation issued by SEBI. The structured questionnaire prepared to
evaluate the performance of the board included criteria such as the board composition and
structure, effectiveness of board processes, information and functioning, etc. The
evaluation of performance of individual directors was carried out on the basis of criteria
such as the contribution of the individual director to the board and committee meetings
like preparedness on the issues to be discussed, meaningful and constructive contribution
and inputs in meetings, etc. The questionnaire for performance of the committees included
criteria such as the composition of committees, effectiveness of committee meetings, etc.
In a separate meeting of independent directors, performance of
non-independent directors, the board as a whole and the Chairman of the Company was
evaluated, taking into account the views of executive directors and non-executive
directors.
DISCLOSURES RELATED TO BOARD, COMMITTEES AND POLICIES
Board Meetings
The Board of Directors met 6 times during the financial year ended
March 31, 2022. The maximum gap between two Board meetings did not exceed 120 days. The
details of the Board meetings and the attendance of Directors thereat are provided in the
Corporate Governance Report forming part of the Annual Report.
Director's Responsibility Statement
In terms of Section 134(5) of the Companies Act, 2013, in relation to
the audited financial statements of the Company for the year ended March 31, 2022, the
Board of Directors hereby confirms that:
a) in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanations relating to material
departures, wherever applicable;
b) such accounting policies have been selected and applied consistently
and the Directors made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at March 31, 2022 and
of the profits of the Company for the year ended on that date;
c) proper and sufficient care was taken for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013 for
safeguarding the assets of the Company and for preventing and detecting fraud and other
irregularities;
d) the annual accounts of the Company have been prepared on a going
concern basis;
e) internal financial controls have been laid down to be followed by
the Company and that such internal financial controls are adequate and were operating
effectively;
f) proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively.
Committees of Board
The Company has constituted the following Committees of Board:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
4. Corporate Social Responsibility Committee
5. Management Committee
The details of the composition, terms of reference, meetings, etc. are
given in the Corporate Governance Report forming part of the Annual Report.
AUDITORS
I. STATUTORY AUDITORS
M/s. NGST & Associates, Chartered Accountants, Mumbai (Firm
Registration No. 135159W) were reappointed as the statutory auditors of the Company to
hold office for a term of 5 years from the conclusion of the 39th Annual General Meeting
held on September 29, 2021 until the conclusion of the 44th Annual General Meeting of the
Company to be held in the year 2026. As per the provisions of Section 139 of the Act, they
have confirmed that they are not disqualified from continuing as Auditors of the Company.
Further, the report of the Statutory Auditors along with notes to
Schedules is a part of the Annual Report. There has been no qualification, reservation,
adverse remark or disclaimer given by the Auditors in their Report.
II. COST AUDITORS:
The Board of Directors based on recommendation of the Audit Committee
has appointed M/s. NKJ & Associates, Cost Accountants in practice, to audit the cost
accounts of the Company for the Financial Year 2022-23. In term of Rule 14 of the
Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor
is required to be ratified by the shareholders. Accordingly, a resolution seeking
ratification by the members for the remuneration is listed as Item No. 4 of the AGM Notice
as Ordinary Resolution.
III. SECRETARIAL AUDITORS:
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Company had appointed M/s. Yogesh Sharma & Co., Practicing Company Secretary to
undertake the Secretarial Audit of the Company for Financial year 2021-22. As required
under provisions of Section 204 of the Companies Act, 2013, the report in respect of the
Secretarial Audit carried out by M/s. Yogesh Sharma & Co., Company Secretaries, in
Form MR-3 for the F. Y. 2021-22 forms part to this report. The said report does not
contain any adverse observation or qualification or modified opinion requiring explanation
or comments from the Board under Section 134(3) of the Companies Act, 2013.
Secretarial Standards
The Company has complied with the applicable Secretarial Standards
issued by the Institute of Company Secretaries of India.
Corporate Social Responsibility
The brief outline of the Corporate Social Responsibility (CSR) policy
of the Company and the initiatives undertaken by the Company on CSR activities during the
year under review are set out in Annexure II of this report in the format prescribed in
the Companies (Corporate Social Responsibility Policy) Rules, 2014. For details regarding
the CSR Committee, please refer to the Corporate Governance Report, which is a part of
this report. The CSR policy is available on www. mangalamorganics.com
MANAGEMENT DISUSSION AND ANALYSIS
Pursuant to Regulation 34 of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 ('Listing Regulations'), the report on
Management Discussion & Analysis is presented in a separate section forming part of
this Annual Report.
CORPORATE GOVERNANCE REPORT
The Company has complied with the Corporate Governance requirements
under the Act and as stipulated under the Listing Regulations. A report on the Corporate
Governance along with the certificate from the statutory auditors is separately given in
this Annual Report.
CREDIT RATINGS
As on March 31, 2022, the Company has following credit ratings from
CRISIL and which were reaffirmed:
Long Term Rating: CRISIL A-/Positive (Rating reaffirmed and Outlook
revised from 'Stable')
Short Term Rating: CRISIL A2+ (Rating and Outlook reaffirmed)
DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT, 2013
INTERNAL FINANCIAL CONTROLS
The Internal Financial Controls with reference to financial statements
as designed and implemented by the Company are adequate. During the year under review, no
material or serious observation has been received from the Statutory Auditors and the
Internal Auditors of the Company on the inefficiency or inadequacy of such controls.
RISK MANAGEMENT & INTERNAL CONTROL SYSTEMS
Adequate internal control systems commensurate with the nature of the
Company's business and size and complexity of its operations are in place and have been
operating satisfactorily. Internal control systems comprising of policies and procedures
are designed to ensure reliability of financial reporting, timely feedback on achievement
of operational and strategic goals, compliance with policies, procedure, applicable laws
and regulations and that all assets and resources are acquired economically, used
efficiently and adequately protected.
DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL
No significant and material orders have been passed by any Regulator or
Court or Tribunal which can have impact on the going concern status and the Company's
operations in future.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The Company has formulated a Policy on Related Party Transactions and
manner of dealing with related party transactions which is available on the Company's
website at the link: www. mangalamorganics.com
Particulars of contracts/arrangements with related parties referred to
in Section 188(1) of the Companies Act, 2013 entered by the Company during the year under
review in the prescribed Form AOC-2 is appended as Annexure III to the Boards' Report
PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS UNDER SECTION 186
The particulars of loans, guarantees and investments given/ made during
the financial year under review and governed by the provisions of Section 186 of the
Companies Act, 2013 has been furnished in financial statements as on March 31, 2022.
Fraud Reporting
During the year under review, no instances of fraud were reported by
the Statutory Auditors of the Company.
Particulars of Employees and Remuneration
The information as required under the provisions of Section 197(12) of
the Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, are set out in Annexure IV attached herewith and which
forms part of this report. The relation between the Company and its employees continue to
be cordial.
A Statement containing the details of the Employees employed throughout
the financial year and who were in receipt of remuneration of Rs. 102 lakhs or more and
employees employed for part of the year and in receipt of remuneration of Rs. 8.50 lakhs
or more per month, pursuant to Rule 5(2) the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 is
provided as Annexure V to this report.
Annual Return:
Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the
draft of the Annual Return as on March 31, 2022 is available on the Company's website at
https://uploads-ssl.webflow.com/6173d 2812ea50ef2de67463e/62ee10325cac0a17f0634f8c
Annual%20 Return%202022.pdf
OTHER DISCLOSURES
Other disclosures as per provisions of Section 134 of the Act read with
Companies (Accounts) Rules, 2014 are furnished as under:
Vigil Mechanism for the Directors and Employees
In compliance with the provisions of Section 177(9) of the Companies
Act, 2013, the Board of Directors of the Company has framed the "Whistle Blower
Policy" as the vigil mechanism for Directors and employees of the Company.
The Whistle Blower Policy is disclosed in Investors' section on the
website of the Company at www.mangalamorganics.com
Policy on Nomination and Remuneration of Directors, KMP & Senior
Employees
The Company has in place a Nomination and Remuneration Policy for the
Directors, KMP and senior employees pursuant to the provisions of the Act and the SEBI
Listing Regulations which is placed on the website of the Company on www.mangalamorganics.
com.
Conservation of energy, technology absorption and foreign exchange
earnings and outgo
The particulars as required under the provisions of Section 134(3) (m)
of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in
respect of conservation of energy and technology absorption have been furnished in
Annexure VI with respect to the nature of activities undertaken by the Company during the
year under review.
Service of documents through electronic means
Subject to the applicable provisions of the Companies Act, 2013, all
documents, including the Notice and Annual Report shall be sent through electronic
transmission in respect of members whose email IDs are registered in their demat account
or are otherwise provided by the members. A member shall be entitled to request for
physical copy of any such documents.
Internal Complaints Committee
The Internal Complaints Committee of the Company as required under The
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
exists for both Factory and Administrative Office of the Company. The Company is strongly
opposed to sexual harassment and employees are made aware about the consequences of such
acts and about the constitution of the said Committee.
Neither were any complaints filed during FY 2021-22 under the
provisions of the said Act, nor were any complaints outstanding as at the beginning of the
year under review.
SAFETY, ENVIRONMENTAL CONTROL AND PROTECTION
The Company is conscious of the importance to environmental friendly
and safe operations. The Company's policy requires conduct of operations in such a manner
so as to ensure safety of all concerned, compliance of environmental regulations and
preservation of natural resources. The plant of the Company at Kumbhivali village is fully
complied with the laws, regulations and requirements stipulated by the concerned pollution
Control Board.
ACKNOWLEDGMENTS AND APPRECIATION
Your Directors take this opportunity to thank the employees, customers,
suppliers, bankers, business partners/associates, financial institutions and various
regulatory authorities for their consistent support/ encouragement to the Company.
Your Directors would also like to thank the Members for reposing their
confidence and faith in the Company and its Management.
Sd/-
Kamalkumar Dujodwala
Chairman
DIN: 00546281
Place: Mumbai
Date: August 13, 2022
|