Your Board of Directors ("Board") is pleased topresent the 30th Annual Report of Advanced Enzyme Technologies Limited ("Company")along with the Audited Financial Statements for the Financial year ("FY")ended March 31 2019.
The financial performance of your Company for the financial year endedMarch 31 2019 is summarized below:
( ` in Million)
|Particulars || |
| || |
Year ended March 31 2019
Year ended March 31 2018
Year ended March 31 2019
Year ended March 31 2018
|Revenue from operations ||2220.93 ||2153.05 ||4195.91 ||3956.99 |
|EBITDA ||523.84 ||496.63 ||1819.14 ||1639.57 |
|Less: || || || || |
|Finance Cost ||22.27 ||30.60 ||38.70 ||80.86 |
|Depreciation and Amortisation ||85.63 ||78.14 ||211.16 ||182.98 |
|Add: || || || || |
|Other income ||56.10 ||50.52 ||50.36 ||13.94 |
|Profit Before Tax ||472.04 ||438.41 ||1619.64 ||1389.67 |
|Less: Provision for Taxation || || || || |
|Current tax ||119.64 ||93.78 ||488.77 ||478.47 |
|Deferred tax ||0.06 ||(14.27) ||(19.72) ||(7.71) |
|MAT credit entitlement ||- ||- ||- ||(17.03) |
|Tax adjustment for earlier years ||- ||- ||(8.44) ||0.38 |
|Profit for the year ||352.34 ||358.90 ||1159.03 ||935.56 |
|Surplus Brought Forward from Previous Year ||1849.15 ||1535.72 ||4332.16 ||3485.17 |
|Amount Available for Appropriations ||2139.62 ||1849.15 ||5375.97 ||4332.16 |
|Earnings Per Share (Amount in `) || || || || |
|Basic ||3.16 ||3.22 ||9.95 ||8.07 |
|Diluted ||3.15 ||3.21 ||9.94 ||8.06 |
RESULTS FROM OPERATIONS
Revenue - Consolidated
Your Company's revenue from operations on consolidated basis financialincreased to ` 4195.91 Million the ("FY19") from ` 3956.99 Million(including excise duty) in the financial year 2017-18 ("FY18") a growth rate of6.04%. The total revenue comprises of International sales amounting to ` 2494.39 Million(FY18 - ` 2168.48 Million) growth of 15.03 % and Domestic sales amounting to ` 1701.52Million (including Export Incentives of ` 18.54 Million) (FY18 - ` 1788.51 Million(including Export Incentives of ` 31.02 Million and excise duty of ` 45.28 Million))decrease of 4.86%.
Your Company's domestic sales constitute 40.55% of revenue fromoperations during FY19 as compared to 45.20% of revenue from operations during FY18.International sales were 59.45% of revenue from operations as compared to 54.80% ofrevenue from operations during FY18.
Revenue - Standalone
Your Company's revenue from operations on standalone basisincreased to ` 2220.93 Million from ` 2153.05 Million in the FY18 at a growth rate of3.15%. The total revenue comprises of International sales of ` 682.88 Million (FY18 - `565.85 Million) increase of 20.68 % and Domestic sales at ` 1538.05 Million (includingExport Incentives of ` 18.54 Million) (FY18 - ` 1587.20
Million (including Export Incentives of ` 31.01 Million and exciseduty)) decrease of 3.10%.
The domestic sales constitute 69.25% of revenue from operations duringFY19 as compared to 73.72% of revenue from operations during FY18. International sales are30.75% of revenue from operations as compared to 26.28% of revenue from operations duringFY18.
Profits - Consolidated
EBITDA (Earnings before interest tax depreciation and amortisationexcluding other income) margin during FY19 was
` 1819.14 Million (43.36%) as compared to ` 1639.57 Million (41.43%)during FY18 increase of about 10.95%.
Profit before tax stood at `1619.64 Million (38.60%) during FY19 asagainst ` 1389.67 Million (35.12%) in the previous year after growthof16.55%.Profit tax stood at ` 1159.03 Million during FY19 as compared to ` 935.56 Million duringthe FY18 a growth of 23.89%.
Profits - Standalone
EBITDA margin during the year under review was at ` 523.84 Million(23.58%) as compared to ` 496.63 Million (23.07%) in the FY18. Profit before tax stood at`472.04 Million during FY19 as compared to ` 438.41 Million in the FY18 a growth of 7.67%.Profitafter tax stood at ` 352.34 Million during FY19 as compared to ` 358.90 Millionduring FY18 a decrease of 1.83%.
The Board recommends a final Dividend @30% i.e.` 0.60/- per equityshare of face value of ` 2/- each for the FY19 aggregating to about ` 67 Million(excluding Dividend Distribution Tax) as compared to final Dividend @ 25% i.e. ` 0.50 perequity share of face value of ` 2/- each for FY18. An amount of ` 9.89 Million would bepaid as Dividend Distribution Tax on the Dividend. The Dividend payout is subject toapproval of Members at 30th Annual General Meeting ("AGM") of your Company.
During the FY19 your Company has not transferred any amount to theGeneral Reserves.
EMPLOYEES STOCK OPTION PLAN
The details of Employees Stock Option Scheme 2015 [as amended] ("ESOPScheme 2015") and Employees Incentive Plan 2017 ("Plan 2017")are provided in Annexure I and forms part of this Report. The said scheme/plan are alsopublished on the website of the Company at www.advancedenzymes.com/investors/corporate-governance
The Nomination & Remuneration Committee in its meeting held onFebruary 14 2017 granted 220000 stock options (of
` 2/- each) to its eligible employees of the Company and the employeesof subsidiaries ("Grantee"). Out of the total Options granted the firsttranche of 10% of stock options got vested on
February 15 2018 as per the provisions of the Scheme. Each Option isconvertible and is equivalent to One (1) Equity Share. Based on the exercise applications& amount received from the Grantees total 18950 Equity Shares of ` 2/- each (at anexercise price of ` 60/- each) were allotted to such Grantees during the year under reviewas follows:
|Date of Board / Security Allotment Committee meeting (Allotment Date) || |
No. of shares allotted
|1 May 19 2018 ||17750 |
|2 June 07 2018 ||1050 |
|3 February 09 2019 ||150 |
|Total ||18950 |
In view of above the Paid-up share capital of your Company hasincreased as follows (as on March 31 2019)
|Particulars || |
| || |
No. of shares
|At the beginning of the year ||111630025 ||223260050 |
|Allotments during the year ||18950 ||37900 |
|At the end of the year ||111648975 ||223297950 |
The second tranche of 20% of Stock Options got vested on
February 15 2019 as per the provisions of the Scheme. Based on theexercise applications of the Grantees and amount received thereto total 19100 EquityShares of ` 2/- each were allotted to such Grantees on May 24 2019 and accordingly thepaid-up share capital of the Company has increased from ` 223297950 to ` 223336150.
The Equity Shares issued under ESOP Scheme 2015 are subject to lock infor a period of 1 year from the Date of Allotment.
Employees Incentive Plan 2017:
The Members of the Company have also approved the AETL EmployeesIncentive Plan 2017 ("Plan 2017") through trust route and related matters on May4 2017 through Postal Ballot. Your Company has received in-principle approval from BSELimited
(BSE) and National Stock Exchange of India Limited (NSE). As on thedate of this report no Stock Options / Stock Appreciation
Rights have been granted under the Plan 2017.
The financial statements of your Company for the year ended
March 31 2019 are prepared in accordance with the Indian AccountingStandards ("IND AS") read with the provisions of Section 129 and otherapplicable provisions if any of the Companies Act 2013 ("the Act")rules framed thereunder and Regulation 33 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended ("SEBI Listing Regulations")and forms part of this Annual Report.
The estimates and judgments relating to the Financial Statements aremade on a prudent basis so as to reflect in a true and fair manner the form andsubstance of transactions and reasonably present the Company's state of affairsprofits and cash flows for the year ended March 31 2019.
Investments in wholly-owned subsidiary Advanced Enzymes (Malaysia)Sdn. Bhd. (AEM'):
Your Company subscribed to Right Issue of 100000 Equity
Shares at MYR 1 per share of AEM aggregating to MYR 100000
(equivalent to approx. ` 17 lakhs) during July 2018.
Details related to the aforementioned Investment are provided on thewebsite of the Company at www.advancedenzymes.com/ investors/stock-exchange-compliance
As on March 31 2019 your Company has Eleven (11) subsidiaries aslisted below:
1. Advanced Bio-Agro Tech Limited (60%) ["ABAT"];
2. Advanced EnzyTech Solutions Limited (100%) ["AESL"];
3. JC Biotech Private Limited (70%)["JCB"]; In terms of thefinancial performances: i. ABAT's revenue for FY19 was 395.39 Million (previousfinancial year ["FY18"] - 422.22 million) and PAT for FY19 was 55.02 Million(FY18 - 54.37 million).
ii. AESL's revenue for FY19 was 94.69 Million (FY18 -
99.70 million) and PAT for FY19 was 5.23 Million (FY18 - 5.84 million).
iii. JCB's revenue for FY19 was 488.83 Million (FY18 -
404.82 million) and PAT for FY19 was 98.25 Million (FY18 - 61.41million).
1. Advanced Enzymes USA (100%);
A. Advanced Supplementary Technologies Corporation (100% Subsidiary ofAdvanced Enzymes USA);
B. Cal-India Foods International (doing Business as Specialty Enzymesand Biotechnologies) (100%
Subsidiary of Advanced Enzymes USA);
C. Dynamic Enzymes Inc. (100% Subsidiary of Advanced Enzymes USA);
D. Enzyme Innovation Inc. (100% Subsidiary of Cal-India
Foods International); performance of In terms of the consolidatedfinancial
Advanced Enzymes USA the revenue for FY19 was 2128.18 Million (FY18 -1814.16 million) and PAT for FY19 was 822.84 Million (FY18 - 649.44 million).
2. Advanced Enzymes (Malaysia) Sdn. Bhd. (100%) ["AEM"];
The Company has acquired AEM in the year 2017 (incorporated in 2016).AEM is in the process of conducting trials on products and yet to generate sales. Duringthe year expenditure was incurred on payment of salaries of technical personadministration and on trials on products and resulted in a loss of 4.78 Million (FY18 6.31million). The said subsidiary will be engaged in supplying and providing enzyme basedsolutions for extraction of palm oil from palm fruits.
3. Advanced Enzymes Europe B.V. (100%) ["AEE"];
In terms of the consolidated financial performance (including evoxxtechnologies GmbH) AEE's revenue for FY19 was 166.74 Million (FY18 111.12 million)and loss of 120.47 Million for FY19 (which includes about 35.16 million of operationalloss and a 48.03 Million amortization expense and finance cost of 46.27 Million) (FY18131.89).
4. evoxx technologies GmbH (100%) [Wholly owned subsidiary of AEE]["evoxx"]
Revenues for evoxx was 166.74 million and had a negative impact on thebottom line by 60.66 Million (which includes about 33.93 Million of operational loss and a18.05 Million of amortization expense and finance cost of 8.68 Million). For FY18Revenues for evoxx added 111.12 Million to the topline and had negatively impacted thebottom line by 131.89 Million (which includes about 70.50 Million of operational loss anda 29.89 Million of amortization expense and a 31.50 Million loss due to foreign currencytranslation loss).
A separate statement containing the salient features of the financialperformance of subsidiaries in the prescribed form AOC - 1 is annexed to the financialstatements of the Company. The Audited Consolidated financial statements together withAuditors' Report forms an integral part of the Annual Report.
The Policy for determining Material Subsidiaries (revised on
February 09 2019 with the effective date as mentioned in the revisedpolicy) is available on the Company's website: www.advancedenzymes.com/investors/corporate-governance. During the year under reviewCal-India Foods International was a Material Subsidiary based on the criteria specified in
SEBI Listing Regulations.
The individual financial statements and other reports of theCompany's subsidiaries have not been attached to the financial statements of theCompany for the FY19. The financial statements of the subsidiary companies and relatedinformation are uploaded on the website of your Company and can be accessed using theweblink www. Advanced enzymes.com/investors/quarterly-updates/ financial-results. AnyMember seeking information on the Annual Financial Statements of the Company'ssubsidiaries may write to the Company Secretary at the registered office of the Company.The financial statements of the Company's subsidiaries will be kept open forinspection at the registered office of the Company from 11:00 A.M. to 3:00 P.M. on allworking days except Saturdays and Sundays up to the date of the 30th AGM of the Companyas required under the provisions of Section 136 of Companies Act 2013.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed review of the operations performance and future outlook ofyour Company subsidiaries and its Business are given in the Management Discussion andAnalysis as required under the SEBI Listing Regulations which is provided in separatesection and forms integral part of this report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 of the Companies Act
2013 the Directors to the best of their knowledge and belief andbased on the information and explanations provided to them confirm that:
a. in the preparation of the annual accounts for the year ended
March 31 2019 the applicable accounting standards read withrequirements set out under Schedule III to the Act have been followed and there are nomaterial departures from the same;
b. appropriate accounting policies have been selected and appliedconsistently and judgments and estimates are made reasonably and prudently so as to give atrue and fair view of the state of affairs of the Company as at March 31 2019 and of theprofit of the Company for the year ended on that date;
c. Proper and sufficient care has been taken for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts have been prepared on a goingconcern' basis;
e. Proper internal financial controls are devised to ensure compliancewith all the provisions of the applicable laws and that such internal financial controlsare adequate and are operating effectively; and
f. Proper systems are devised to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
Your Company understands that controlling risks through a formalprogram is a necessary component and an integral cornerstone of Corporate Governance. YourCompany has adopted a revised
Risk Assessment & Management policy in supersession of the existingpolicy which embeds the vision that a robust Risk Management system ensures commensuratecontrols and monitoring mechanism for smooth and efficient management of Business. ThePolicy outlines the framework for identification measurement evaluation monitoring andmitigation of various risks. The Management has also reviewed the Risk Managementframework of the Company. The Risk Registers are prepared by the concerned departmentswherein the respective risks are identified alongwith its current control activities andthe mitigation plans.
Thereafter the registers are reviewed.
RELATED PARTY TRANSACTIONS
During the year under review all transactions with related partieswere placed before the Audit Committee for its approval. An omnibus approval from theAudit Committee was obtained for the related party transactions which are repetitive innature. All the transactions with related parties entered into during the year underreview were in the Ordinary Course of Business and on
Arms' Length Basis in accordance with the provisions of the Act
Rules made thereunder and SEBI Listing Regulations.
The Audit Committee and the Board review all the transactions enteredinto pursuant to the omnibus approvals on a quarterly basis. Approval of the Members ofthe Company is also obtained in case any related party transaction exceeds the prescribedlimits and as good corporate governance practice as there may be few transactions that maybe carried out in the long-term interest of the Company.
The Policy on Related Party Transactions (including the revised policyapplicable for related party transactions effective April 01
2019) is available on the Company's website and can be accessedat www.advancedenzymes.com/investors/corporate-governance
As prescribed by Section 134(3)(h) of the Companies Act 2013 read withRule 8(2) of the Companies (Accounts) Rules 2014 particulars of contracts/arrangementswith related parties are given in Form AOC-2 annexed as Annexure II to this report.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to Section 124(6) of the Companies Act 2013 all shares inrespect of which Dividend has not been paid or claimed for seven consecutive years or moreshall be transferred by the company in the name of Investor Education and Protection Fund("IEPF").
In view of this your Company has transferred 27000 unclaimed
Equity Shares pertaining to financial year 2010-2011 to the Demataccount of IEPF during October 2018. The details of the said shares transferred areprovided on the website of the Company atwww.advancedenzymes.com/investors/shareholder-information
During the year under review the Company has transferred unclaimedDividend of ` 24940 for the financial year 2010-11. As on March 31 2019 the totalamount lying in the Unpaid Dividend accounts of the Company in respect of the last sevenyears is around ` 0.77 lakhs. Details of unclaimed Dividend & Shares due for transferwith due dates and procedure to claim the same are provided in the Notes to Notice for30th AGM and in the Corporate Governance Report which forms part of this Report.
Details of Nodal Officer are displayed on the Company's websiteat: www.advancedenzymes.com/investors/shareholder-information/
CORPORATE SOCIAL RESPONSIBILITY ("CSR")
The Annual Report on Corporate Social Responsibility Activities hasbeen provided in Annexure III and forms integral part of this report. The Composition ofCSR Committee is disclosed in the said Annual Report on CSR Activities and in theCorporate
Governance report section.
The Corporate Social Responsibility Policy (revised effective fromJanuary 08 2019) may be accessed on the Company's website atwww.advancedenzymes.com/investors/corporate-governance.
POLICY ON CRITERIA FOR APPOINTMENT / REMOVAL OF DIRECTORS AND SENIORMANAGEMENT PERSONNEL AND REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL AND EMPLOYEES
As per the Nomination & Remuneration Policy of the Company("Policy") the Nomination and Remuneration Committee inter aliarecommends the appointment of Directors Key Managerial
Personnel (KMP) and Senior Management Personnel. The
Policy lays down the criteria for such appointments and the frameworkin relation to remuneration of Directors including
Managerial Personnel KMPs & employees of the Company. The
Nomination & Remuneration Committee looks into the matter ofremuneration of the Executive Directors KMPs & Senior Management Personnel andrecommend to the Board revision if any in the remuneration of the said Directors /Personnel subject to limits as may be approved by the shareholders.
The Nomination and Remuneration Policy may be accessed on the
Company's website at www.advancedenzymes.com/investors/corporate-governance. We affirm that the remuneration paid to the Directors is as per theterms laid out in the Nomination and Remuneration Policy of the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review the following changes occurred in thecomposition of the Board of Directors and the Key Managerial Personnel:
Mrs. Rupa Vora (DIN: 01831916) resigned as an Independent Director ofthe Company with effect from May 18 2018 due to personal reasons. The Board placed onrecord its appreciation for her association with the Company and the contribution made byMrs. Vora during her tenure as an Independent Director.
The Shareholders at their 29th Annual General Meeting
("29th AGM") held on September 14 2018 approved theappointment of Mr. Rajesh Sharma (DIN: 08195715) as an Independent Director for a periodof five years effective from August 11 2018. The resolution for regularization of Mr.Suresh Paharia as an Independent Director was not approved at the 29th AGM. TheShareholders at 29th AGM did not approve the re-appointment of retiring Director Mr.Chandrakumar L. Rathi (DIN: 00365691) the then Managing Director of the Company.
Mr. Piyush Rathi resigned as a Chief Business Officer (Key ManagerialPersonnel) of the Company with effect from December 31 2018. under Regulation During theyear under review based on the recommendation of the Nomination & RemunerationCommittee the Board approved the appointment of Ms. Rasika Rathi (DIN: 08300682) as anAdditional Director (Non-Executive) w.e.f January 08 2019 to hold the 30 office th AnnualGeneral Meeting. Further the Board also approved the appointment of Mr. Vilas M.Aurangabadkar (DIN: 08225986) and Mr. Vinodkumar H. Jajoo (DIN: 08224980) as AdditionalDirectors (Independent) w.e.f January 08 2019 and February 09 2019 respectively for aterm of five (5) years subject to the approval of the Members at the 30th AGM of theCompany. Accordingly the Board recommends the appointment of Ms. Rasika Rathi (liable toretire by rotation) Mr. Vilas M Aurangabadkar and Mr. Vinodkumar H Jajoo (not liable toretire by rotation) and brief profile appointed has been provided in Notice convening the30th AGM of the Company ("AGM Notice").
Mr. Ramesh Mehta (DIN: 00367439) Independent Director of the
Company whose first
31 2019 has voluntarily refused to get re-appointed for the secondterm due to his age and health and therefore has ceased to be on the Board of the Company.The Board appreciated his valuable contribution to the Company over the years & wishedat him good health. Further the term of five (5) years of Mr. Kedar
Desai (DIN: 00322581) Independent Director of the Company concluded onMarch 31 2019. Based on the recommendation of the Nomination & RemunerationCommittee the Board has approved and recommended the re-appointment of Mr. Desai as anIndependent Director on the Board of the Company for second term of five (5) yearseffective April 01 2019.
Except as mentioned above there has been no change in the compositionof Board and Key Managerial Personnel of the Company during the year under review.
RETIREMENT BY ROTATION
In accordance with the provisions of Section 152 of Companies Act 2013read with Rules made thereunder and the Articles of Association of the Company Mrs.Savita Rathi (DIN: 00365717)
Whole-time Director retires by rotation at the 30th AGM and beingeligible offers herself for re-appointment. Accordingly the Board recommends the saidre-appointment of Mrs. Savita Rathi at the 30th AGM and her brief profile has beenprovided in the AGM Notice.
DECLARATION BY THE INDEPENDENT DIRECTORS
All Independent Directors of the Company have given the declarationsthat
(i) they meet the criteria of Independence' as
16(1) of the SEBI Listing Regulations defined and Section 149(6) of theCompanies Act 2013 read with
Schedule IV and the relevant Rules made thereunder;
(ii) they have complied with the provisions of the Code of Conduct& Ethics of the Company. The Independent Directors have confirmed that they are notaware of any circumstance or situation which exist or may be reasonably anticipated thatcould impair or impact their ability to discharge their duties with an objectiveindependent judgment and without any external influence. None of the
Directors of the Company are disqualified for being appointed asDirectors as specified in Section 164(2) of the Companies Act 2013 and Rule 14(1) of theCompanies (Appointment and Qualification of Directors) Rules 2014.
AUDITORS AND AUDITORS' REPORT of the said Directors proposedto be
Pursuant to provisions of Section 139 of the Companies Act 2013 readwith the Companies (Audit and Auditors) Rules 2014 term of five(5) years concluded onMarch B S R & Co. LLP Chartered Accountants [Firm's Registration No:101248W/W-100022] ("BSR") were appointed as Statutory Auditors for a termof five years to hold officefrom the conclusion of 27th Annual General Meeting up to theconclusion of the 32nd Annual General Meeting subject to ratification GeneralMeeting. However in accordance with the amendment to the provisions of Section 139 ofCompanies Act 2013 the of Statutory Auditors at every Annual ratification
General Meeting has been omitted and therefore the ratification ofappointment of Statutory Auditors is not being sought.
The Auditors' Report to the Members on the Financial Statements ofthe Company for the year ended March 31 2019 does not reservation contain anyqualification or adverse remark.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act
2013 and rules made thereunder the Company has appointed Mr. Shiv HariJalan Company Secretary (FCS No. 5703 C.P.No.4226) to undertake the Secretarial Audit ofthe Company. The Secretarial Audit Report for the financial year 2018-19 is annexed asAnnexure IV and forms an integral part of this Report. The Secretarial Audit Report forthe year ended March 31 2019 does not contain any qualification reservation or adverseremark.
CORPORATE GOVERNANCE REPORT
The Report on Corporate Governance and the Certificate of the
Practicing Company Secretary regarding compliance of the conditions ofCorporate Governance as required pursuant to the provisions of the SEBI ListingRegulations are enclosed as Annexure V. A declaration signed by the Whole-time Directoraffirming compliance with the Code of Conduct by the members of the Board and SeniorManagement Personnel also forms part of this Report.
COMMITTEES OF THE BOARD
As per the Companies Act 2013 and the SEBI Listing Regulations theBoard has four Statutory Committees viz. Audit Committee
Nomination and Remuneration Committee the Corporate SocialResponsibility Committee and the Stakeholders' Relationship
Committee. The details of the composition of these Committees alongwith number of meetings held and attendance at the meetings are provided in the CorporateGovernance Report and forms part of this Report.
Your Company had adopted Whistle Blower Policy / Vigil Mechanism Policypursuant to the provisions of Section 177(9) of the Companies Act 2013 and the Companies(Meetings of
Board and Its Powers) Rules 2014 and Regulation 22 of the SEBI ListingRegulations. Details on the Vigil Mechanism of your Company have been outlined inCorporate Governance Report which forms part of this Report.
The said Policy has been amended effective from April 01 2019primarily encompassing the amendments to the SEBI (Prohibition of Insider Trading)Regulations 2015.
The Whistle Blower Policy (as revised) may be accessed on your
Company's website at www.advancedenzymes.com/investors/corporate-governance
MEETINGS OF THE BOARD
During the year Eight (8) meetings of the Board of Directors wereheld. The requisite details of the Board Meetings and the details of the Directors presentare provided in the Corporate Governance Report which forms part of this Report.
The Company has complied with all the provisions of applicable
Secretarial Standards issued by Institute of Company Secretaries ofIndia and notified
EVALUATION OF PERFORMANCE OF BOARD ITS COMMITTEES AND DIRECTORS
Pursuant to the provisions of the Companies Act 2013 and the SEBIListing Regulations the Board has undertaken an Annual
Evaluation of its own performance its various Committees andindividual Directors. The manner in which the performance evaluation has been carried outhas been given in the Corporate
Governance Report annexed to this Report. The Board expressed itssatisfaction of the evaluation process & outcome.
The Board Evaluation policy can be accessed on your Company'swebsite at www.advancedenzymes.com/investors/corporate-governance.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
Pursuant to provisions of Regulation 25(7) of the SEBI ListingRegulations the detail of familiarization program is available at website of your Companyat www.advancedenzymes.com/ investors/corporate-governance. Further at the time of theappointment of an Independent Director the Company issues a Letter of appointmentoutlining his / her role function duties and responsibilities. The format of the letterof appointment is available on the Company's website at:www.advancedenzymes.com/investors/corporate-governance
CODE OF CONDUCT FOR PROHIBITION OF INSIDER TRADING
Your Company has in place a Code of Conduct for Prohibition of InsiderTrading which lays down the process of trading in securities of the Company by theDesignated Persons and to regulate monitor and report trading by the employees of theCompany either on his/her own behalf or on behalf of any other person on the basis ofUnpublished Price Sensitive Information.
The said Code has been revised and substituted effective from April 012019 to be known as AETL Insider Trading Code encompassing the amendments to the SEBI(Prohibition of Insider Trading) Regulations 2015.
The aforementioned amended Code is available on the website of theCompany at www.advancedenzymes.com/investors/ corporate-governance
INTERNAL CONTROL AND ITS ADEQUACY
Your Company has adopted procedures and systems for ensuring theorderly and efficient conduct of its Business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of financial disclosures. Your Company maintains appropriate and adequateInternal Control System / Internal Financial Control commensurate to its size and natureof operations. Your Company's Internal control systems are tested and certifiedby theInternal Auditors and Statutory Auditors of the Company.
The Audit Committee periodically reviews the report(s) of theindependent Internal Auditors along with the adequacy and effectiveness of InternalControl systems.
SIGNIFICANT AND MATERIAL ORDERS
During significant and the year under review there were no materialorders passed by the Regulators or Courts or Tribunals impacting the going concern statusand its future operations.
CHANGE IN THE NATURE OF BUSINESS IF ANY
There was no change in Business and in the nature of Business of yourCompany during the year under review affecting the financial position of the Company.
MATERIAL CHANGES FROM THE DATE OF END OF FINANCIAL YEAR TILL THE DATEOF THIS REPORT
Except as otherwise mentioned in this report there are no materialchanges and commitments affecting the financial position of the Company which haveoccurred between the end of the Financial year of the Company to which the FinancialStatements related and the date of this report.
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN ANDSECURITIES PROVIDED
The details of Loans and Investments under Section 186 of the CompaniesAct 2013 read with the Companies (Meetings of Board and its Powers) Rules 2014 for theFY19 are given in the Standalone Financial Statements (Note 51 to the standalone financialstatements). Your Company has not provided any guarantee or security under Section 186 ofthe Companies Act 2013 during the year under review.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 92 of the Companies
Act 2013 read with the rules framed thereunder an extract of AnnualReturn of the Company in the Form MGT-9 is enclosed as Annexure VI to this report and isalso available on the website of the Company at www.advancedenzymes.com
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO
Information pertaining to conservation of energy technologyabsorption foreign exchange earnings and outgo as required under Section 134 of theCompanies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 isfurnished in Annexure VII and forms part of this Report.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Pursuant to Section 197(12) of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014the details are disclosed in Annexure VIII to this report.
The statement containing particulars of remuneration of employees asrequired under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies(Appointment and
Remuneration of Managerial Personnel) Rules 2014 is given in anAnnexure IX to this Report. In terms of Section 136(1) of the Act the Annual Report isbeing sent to the Members excluding the said Annexure IX. However this annexure isavailable for inspection by the Members at the Registered Office of the Company duringBusiness hours on all working days except Saturdays and Sundays up to the date of the AGM.Any Member desirous of obtaining a copy of the said Annexure may write to the CompanySecretary at the Registered Office address of your Company.
During the year under review your Company did not invite or accept anyDeposits covered under Chapter V of the Companies
Act 2013 ("Act"). There were no outstanding deposits withinthe meaning of Sections 73 and 74 of the Act read together with the Companies (Acceptanceof Deposits) Rules 2014 at the end of the year under review or the previous financialyear.
During the year under review there was no revision in the ratingreceived from CRISIL. The rating stood at A/Stable for Bank facilities to the tune of `100 Crores by Credit Rating Information Services of India Limited (CRISIL).
The Company has maintained Cost records in accordance with theprovisions of Section 148(1) of Companies Act 2013 during the year under review.
During the year under review:
a. Neither the Managing Director (during his tenure) nor the Whole-timeDirectors of your Company received any remuneration or commission from any of thesubsidiaries.
b. Your Company has not issued Shares with Differential
Rights as to Dividend Voting or otherwise.
c. Your Company has devised a policy on Prevention of Sexual Harassmentto comply with the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. The said policy is hosted on the
Company's website at www.advancedenzymes.com. During the yearunder review there were no cases / grievances reported or pending and the Company hascomplied with provisions relating to the constitution of Internal Complaints Committeeunder the Sexual Harassment of Women at
Workplace (Prevention Prohibition and Redressal) Act 2013.
d. There are no details to be disclosed under Section 134(3) (ca) ofthe Act as there has been no such fraud reported by the Auditors under Section 143(12) ofthe Act.
Your Directors acknowledge with gratitude the support received by theCompany from the Banks Government Agencies/ organizations and employees of your Company.
Your Directors also acknowledge with thanks the faith reposed by theInvestors in the Company and look forward to their continued support for times to come.
For and On behalf of the Board of Directors of
Advanced Enzyme Technologies Limited
Vasant L. Rathi
Date : May 24 2019
Place : Thane