Insecticides India Ltd.
|BSE: 532851||Sector: Agri and agri inputs|
|NSE: INSECTICID||ISIN Code: INE070I01018|
|BSE 00:00 | 24 Apr||Insecticides India Ltd|
|NSE 05:30 | 01 Jan||Insecticides India Ltd|
|Mkt Cap.(Rs cr)||836|
|Mkt Cap.(Rs cr)||835.89|
Insecticides India Ltd. (INSECTICID) - Director Report
Company director report
The Board of Directors hereby submit the report of the business and operations of yourCompany (the Company or IIL) along with the audited financialstatements for the financial year ended March 312019.
1. Financial Results and State of Companys Affairs
( ? in Lacs except per equity share data)
During the year under review revenue of the company has increased to Rs. 1192 Croresfrom Rs. 1073 Crores in FY2018 with a growth rate of 11.1%. EBITDA increased by 25.6% toRs. 186 Crores from Rs. 148 Crores as compared to same period last year. Profit afterTax(PAT) increased by 45.8% to Rs. 122 Crores from Rs. 84 Crores in FY2018.
EBITDA margins increased to 15.6% as compared to 13.8% last year increased marginsreflect our improving product portfolio mix and launching of new innovative moleculesdeveloped by our R&D Centers. PAT margin increased to 10.2% from 7.8% in FY2018improvement of 2.4% over corresponding period.
Domestic sales margins growth is product portfolio mix and launching of new innovativeproducts. Exports for the fiscal year increased to Rs. 60 Crores from Rs. 34 Croresrepresenting a growth of 76%.
2. Dividend and Reserves
The Board of Directors have recommended a final dividend of Rs. 2.00/- per equity share(20%) for FY 201819 (Previous year Rs. 2.00/- per equity share). The final dividend onequity shares if approved by the members.
The Register of member and share transfer Books will remain closed from July 27 2019to August 02 2019 (both day inclusive) for the annual closing and determining of theshareholders eligible to receive the final dividend for the Financial Year ended March312019.
3. Share Capital
The paid up Equity Share Capital of the Company as on March 31 2019 was Rs. 2066.78Lacs. There was no change in the Companys Share Capital during the year underreview.
4. Credit Rating
The Company enjoys a good reputation for its sound financial management and ability tomeet in financial commitments.
CRISIL a S&P Global Company a reputed Rating Agency has re-affirmed the creditrating of CRISIL A/Stable for the long-term and CRISIL A1 for the Short-term Bankfacilities.
5. Award and Recognitions
Your Company received awards at various industry platforms in the area of Managementcorporate management digital engagement and corporate social responsibility.
Some of the awards are listed below:
Company of the Year Award : The Company has received "Company of the YearAward" in Agri Business Summit & Agri Awards 2019
Runner Up Best Emerging Company : The Company has received the Runner Up bestEmerging Company award in the PMFAI AGCHEM Awards 2018.
6. Particulars of Loans given Investment made Guarantees given And Securitiesprovided
Details of the loans given by your Company under Section 186 of the Act during thefinancial year ended March 31 2019 are as follows: New Age Knowledge Solutions Limited:
400.00 Lacs at the interest rate of 12.00% per annum for general business purpose(Total outstanding at the end of the year was Rs. 408.99/- Lacs); Mentor FinancialServices Private Limited: Rs. 800.00 Lacs at the interest rate of 12.00% per annum forgeneral business purpose (Total outstanding including interest at the end of the year wasRs. 818.58 Lacs); and Leela Foods Private Limited: Rs.
300.00 Lacs at the interest rate of 16.00% per annum for general business purpose (Loanoutstanding at the end of the year was Nil). For details of investments please refer noteno. 10 forming part of financial statements.
The Company had invested in equity shares of OAT & IIL India Laboratories PrivateLimited the said company is the Joint Venture of your company w.e.f March 06 2013 andalso invested in the shares of OAT Agrico Co. Ltd. Japan a Joint Venture partnerCompany.
Your Company has not accepted any deposits under Section 73 and 74 of the CompaniesAct 2013 ("the Act") and no amount of principle or interest was outstanding asof Balance Sheet date.
8. Subsidiary Company Associate Company And Joint Venture Company
There is no subsidiary Company of the Company during the year under review.
The Company has "OAT & IIL India Laboratories Private Limited" as itsjoint venture within the meaning of Section 2(6) of the Act as on March 312019.
A highlights of performance of associates and joint venture along with therecontribution to all overall performance of the Company during the period are provided in Annexure- 1 and hence not repeated here for the sake of brevity.
9. Consolidated Financial Statements
The Consolidated Financial Statements of the Company for the Financial Year 2018-19 areprepared in compliance
with the applicable provisions of the Act Accounting Standards and Regulations asprescribed by Securities and Exchange Board of India SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (SEBI "Listing Regulations").
The Consolidated Financial Statements have been prepared on the basis of the auditedfinancial statements of the Company and its Joint Venture Company as approved by theirrespective Board of Directors.
Pursuant to the provisions of Section 136 of the Act the Financial Statements of theCompany the Consolidated Financial Statements along with all relevant documents and theAuditors Report thereon form part of this Annual Report. The Financial Statements asstated above are also available on the website www.insecticidesindia.comof the Company.
10. Transfer to Reserves
Your Directors do not propose to transfer any amount to the reserves.
11. Managements discussion and analysis
Managements Discussion and Analysis Report for the year under review asstipulated under Regulation 34 read with Schedule V of the SEBI "ListingRegulations" is presented in a separate section forming part of the Annual Report.
12. Corporate Social Responsibility
The Corporate Social Responsibility Committee (CSR Committee) has formulated andrecommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicatingthe activities to be undertaken by the Company which has been approved by the Board.
The CSR Policy may be accessed on the Companys website at the link:
The key philosophy of all CSR initiatives of the Company is guided by three corecommitments of Scale Impact and Sustainability.
The Company has identified following focus areas for CSR engagement:
Rural Transformation: Creating sustainable
livelihood solutions addressing poverty hunger and malnutrition.
Environment: Environmental sustainability ecological balance conservationof natural resources and promoting bio-diversity.
Health: Affordable solutions for healthcare through improved accessawareness and health seeking behavior.
Education and Sports: Access to quality education training and skillenhancement building sports & skills in young students.
Disaster Response: Managing and responding to disaster.
Art Heritage and Culture: Protection and promotion of Indias artculture and heritage.
The Company would also undertake other need based initiatives in compliance withSchedule VII to the Act. The annual report on CSR activities is annexed herewith andmarked as Annexure - 2.
13. Risk Management
The Company has formulated the Risk Management Policy through which the Company hasidentified various risks
like strategy risk industry and competition risk operation risk liability riskresource risk technological risk financial risk. The Company faces constant pressurefrom the evolving marketplace that impacts important issues in risk management andthreatens profit margins. The Company emphasizes on those risks that threaten theachievement of business objectives of the Group over the short to medium term. YourCompany has adopted the mechanism for periodic assessment to identify analyze andmitigation of the risk.
The appropriate risk identification method will depend on the application area (i.e.nature of activities and the hazard groups) the nature of the project the project phaseresources available regulatory requirements and client requirements as to objectivesdesired outcome and the required level of detail.
The trend line assessment of risks analysis of exposure and potential impact shall becarried out. Mitigation plans shall be finalized owners identified and progress ofmitigation actions shall be regularly and periodically monitored and reviewed.
Treatment options which are not necessarily mutually exclusive or appropriate in allcircumstances shall be driven by outcomes that include:
Avoiding the risk
Reducing (mitigating) the risk
Transferring (sharing) the risk and
Retaining (accepting) the risk.
The Risk management Policy of the Company is annexed herewith as Annexure - 3 tothis Report.
14. Vigil Mechanism
The Company promotes ethical behaviour in all its business activities and has put inplace a mechanism for reporting unethical behaviour fraud violations or bribery. TheCompany has Vigil Mechanism (Whistle Blower) Policy under which the employees are free toreport violations of applicable Laws and Regulations and the Code of Conduct the same canbe accessed through the Chairman of the Audit Committee. The reportable matters may bedisclosed to the Ethics and Compliance Task Force which operates under the supervision ofthe Audit Committee. Employees may also report to the Chairman of the Audit Committee.During the year under review no such complain has been received and no employee was deniedaccess to the Audit Committee for reporting violations.
15. Disclosure of Remuneration & Particulars Of Employees And Related Disclosures
The information as required in accordance with Section 197(12) of the Act read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 the details regarding the remuneration and other requisite details are mentioned inthe Annexure - 4(a) hereto.
List of employee drawing the remuneration in excess of limit prescribed under Section197 of the Companies Act 2013 read with rule 5(2) of the Companies (Appointment andManagerial Personnel) Rules 2014 is mentioned in Annexure -4(a).
No director of the Company who is receiving commission from the Company is in receiptof any remuneration or commission from any holding company or subsidiary company of theCompany.
The Remuneration Policy of the company is annexed herewith as Annexure - 4(b) tothis Report.
Pursuant to the Provisions of Companies Act 2013 ("Act") the Shareholdersin the 19th AGM of your Company held on September 212016 appointed Mr. S.Jayaraman (DIN : 02634470) and Mr. Vinod Kumar Mittal (DIN: 07421742) as an IndependentNon-Executive Director of the Company for three consecutive years term up to February 092019. Mr Jayaraman and Mr. Mittal are eligible for re-appointment as an Independent Non-Executive Director for a second term of five consecutive years. Pursuant to the provisionsof the Act based on the recommendation of the Nomination and Remuneration Committee theBoard recommends for the approval of the Members through a Special Resolution in the 22ndAGM of your Company the re-appointment of Mr. Jayaraman and Mr. Mittal as an IndependentNonExecutive Director for second term of five consecutive years from February 09 2019 upto February 08 2024.
Pursuant to the Provisions of Companies Act 2013 ("Act") the Shareholdersin the 17th AGM of your Company held on September 19 2014 appointed Mr. NavinShah (DIN : 02701860) and Mr. Virjesh Kumar Gupta (DIN: 06382540) as an IndependentNon-Executive Director of the Company for five consecutive years a term up to May 312019. Mr Shah and Mr. Gupta are eligible for re-appointment as an Independent Non-Executive Director for a second term of five consecutive years. Pursuant to the provisionsof the Act based on the recommendation of the Nomination and Remuneration Committee theBoard recommends for the approval of the Members through a Special Resolution in the 22ndAGM of your Company the re-appointment of Mr. Shah and Mr. Gupta as an IndependentNon-Executive Director for second term of five consecutive years from May 312019 up toMay 30 2024.
In accordance with the provisions of the Section 152 of the Companies Act 2013 Smt.Nikunj Aggarwal (DIN: 06569091) Directors of the Company retire by rotation at theforthcoming Annual General Meeting of the Company and being eligible offer herself forre-appointment. The Board of Directors on the recommendation of the Nomination andRemuneration Committee has recommended her reappointment.
The information of Directors seeking appointment/ reappointment as required pursuant toRegulation 36(3) of SEBI Listing Regulations and Companies Act 2013 is provided in thenotice of the 22nd Annual General Meeting of the Company.
All the Independent directors have given declaration that they meet the criteria ofIndependence laid down under Section 149 (6) of the Companies Act 2013 and Regulation16(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
17. Meeting of the Board
During the financial year 2018-19 the Board of Directors met 4 (Four) times thedetails of which are given in the Corporate Governance Report that forms the part ofAnnual Report. The notice along with Agenda of each Board Meeting was given in writing toeach Director. The intervening gap between any two meetings was within the periodprescribed by the Act and SEBI Listing Regulations.
18. Performance Evaluation Report
In terms of Companies Act 2013 and SEBI Listing Regulations there is requirement offormal evaluation by the Board of its own performance and that of its committees andindividual directors.
The evaluation of Board of its own performance and that of its committees andindividual directors was conducted
based on criteria and framework adopted by the Board. The evaluation criteria have beenexplained in the Nomination and Remuneration Policy adopted by the Board.
19. Familiarisation Programme for Independent Directors
Pursuant to the provisions of Regulation 25 of the SEBI Listing Regulations theCompany has formulated a programme for familiarising the Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company etc. through variousinitiatives. The details of the aforementioned programme is available on theCompanys website at http:// www.insecticidesindia.com/.
Further the Company has received declaration from all the Independent Directors asenvisaged in sub section (6) of Section 149 of the Companies Act 2013.
20. Board Committees
In compliance with the requirements of the Act and SEBI Listing Regulations your Boardhad constituted various Board Committees including Audit Committee Nomination &Remuneration Committee Stakeholders Relationship Committee Finance Committee andCorporate Social Responsibility Committee.
Details of the constitution of these Committees which are in accordance withregulatory requirements have been uploaded on the website of the Company viz. www.insecticidesindia.com. Details of scope constitution terms of reference number ofmeetings held during the year under review along with attendance of Committee Memberstherein form part of the Corporate Governance Report annexed herewith this report. Adetailed report on Corporate Social Responsibility activities initiated by the Companyduring the year under review in compliance with the requirements of Companies Act 2013is annexed to this report.
21. Key Managerial Personnel
During the financial year under review there was no change in the Key ManagerialPersonnel of the Company
The following persons have been continued to be designated as Key Managerial Personnelof the Company pursuant to Section 2(51) of the Act read with the Rules framed thereunder.
1. Shri Hari Chand Aggarwal - Chairman & WTD
2. Shri Rajesh Aggarwal - Managing Director
3. Smt. Nikunj Aggarwal - Whole-time Director
4. Shri Sandeep Kumar - Company Secretary
5. Shri Sandeep Aggarwal - Chief Financial Officer
During the year 2018-19 information as mentioned in Part A of Schedule II of SEBIListing Regulations has been placed before the board for its consideration.
22. Directors Responsibility Statement
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that:
a) in the preparation of the annual accounts for the year ended March 31 2019 theapplicable accounting standards had been followed along with proper explanation relatingto 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 of the Company for the year;
c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) the directors have 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;
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.
23. Contracts Or Arrangements With Related Parties
Your Company has formulated a policy on related party transactions which is alsoavailable on Companys website at the link
All related party transactions entered duringthe Financial Year were in ordinary courseofthe business and on arms length basis. Disclosure of related partytransactions asrequired under Section 134(3)(h)of the Companies Act 2013 in Form AOC 2 is given andannexed as Annexure -5.
Members may refer to Note No. 37 of the financial statement which sets out relatedparty disclosures pursuant to IndAS-24.
24. Details in respect of adequacy of Internal Financial Controls
The Board has adopted the policies and procedures for ensuring the orderly andefficient conduct of business including adherence to the Companys policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and timely preparation of reliablefinancial disclosures.
25. Details of Significant & Material Orders
No significant and material order has been passed by the Regulators or Courts orTribunals impacting the going concern status of the Company and Companys operationsin future details of which needs to be disclosed in the boards report as Section134 (3)(q) read with rule 8 of Companies (Accounts) Rules 2014.
26. Material Changes and Commitments
There have been no material changes and commitments
affecting the financial position of the company which have occurred between the end ofthe financial year of the Company to which the financial statements relate and the date ofthe report.
M/s S S Kothari Mehta & Company. Chartered Accountants (ICAI Regd. No.: 000756N)and M/s Devesh Parekh & Co. Chartered Accountants (ICAI Regd. No.: 013338N) wereappointed as Auditors of the Company at the Annual General Meeting held on August 082017 for term of 5 (Five) consecutive Years. They have confirmed that they are notdisqualified from continuing as Auditors of the Company.
The Notes on financial statement referred to in the Auditors Report areself-explanatory and do not call for any further comments. The Auditors Report doesnot contain any qualification reservation adverse remark or disclaimer.
During the year under review the Auditors had not reported any matter under Section143 (12) of the Act therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
The Board of Directors had appointed Akash Gupta & Associates Company Secretaries(PCS Regis. No. 11038) to conduct Secretarial Audit for FY 2019-2020. During the yearunder review the company complies with all applicable secretarial standards. TheSecretarial Report given by the Secretarial Auditors is annexed and forms integral part ofthis Report. The Secretarial Audit Report does not contain any qualification reservationadverse remark or disclaimer.
During the year under review the Secretarial Auditors had not reported any matterunder Section 143 (12) of the Act therefore no detail is required to be disclosed underSection 134 (3)(ca) of the Act.
In terms of Section 204 of the Companies Act 2013 the Audit Committee recommended andthe Board of Directors appointed M/s. Akash Gupta & Associates Company Secretaries(PCS Registration No.11038) as the Secretarial Auditors of the Company in relation to thefinancial year 2018-19. The Company has received their consent for appointment.
In terms of the requirement of Section 148 of the Act read with Companies (Cost Recordsand Audits) Rules 2014 the cost audit records maintained by the Company is required tobe audited the Audit Committee recommended and the Board of Directors appointed M/sAggarwal Ashwani K & Associates Cost Accountants as Cost Auditors of the Company tocarry out the cost audit for the financial year 2018-19. The Company has received theirwritten consent that the appointment is in accordance with the applicable provisions ofthe Act and rules framed thereunder. The remuneration of Cost Auditors has been approvedby the Board of Directors on the recommendation of Audit Committee and in terms of theCompanies Act 2013 and Rules thereunder the requisite resolution for ratification ofremuneration of Cost Auditors by the members has been set out in the Notice of the 22ndAnnual General Meeting of your Company.
The Cost Audit Report of the relevant period does not contain any qualificationreservation adverse remark or disclaimer.
During the FY 2018-2019 the Cost Auditor has not reported any matter under Section143(12) of the Act therefore no
details is required to be disclosed under Section 134(3)(ca) of the Act.
28. Corporate Governance
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by the Securities and ExchangeBoard of India (SEBI). The report on Corporate Governance as stipulated under the ListingRegulations forms an integral part of this Report. The requisite certificate from theAuditors of the Company confirming compliance with the conditions of Corporate Governanceis attached to the report on Corporate Governance.
29. Business Responsibility Report
In compliance with Regulation 34 of SEBI Listing Regulations the BusinessResponsibility Report detailing the various initiatives taken by the Company onenvironmental social and governance front is forming a part of this Annual Report. TheBoard of Directors has adopted a Business Responsibility Policy. The said Policy isavailable on Companys website at http://www.insecticidesindia.com/
30. Conservation Of Energy Technology Absorption Foreign Exchange Earnings &Outgo
In terms of requirement of clause (m) of sub-section (3) of Section 134 of theCompanies Act 2013 read with the Companies (Account)s Rules 2014 the particularsrelating to conservation of energy technology absorption foreign exchange earnings andoutgo as required to be disclosed under the Act are provided in Annexure - 6 tothis report.
31. Extract of Annual Return
In accordance with Section 134 (3) (a) of the Act an extract of Annual Return of theCompany is annexed herewith as Annexure - 7 to this Report.
The annual return for the financial year 2018-19 is available on Companys websiteat http://www.insecticidesindia.com/
32. Disclosure under the Sexual Harassment of Women at the Work Place (PreventionProhibition and Redressal) Act 2013
The Company has in place an Anti-Sexual Harassment Policy (Policy) in linewith the requirements of The Sexual Harassment of Women at the Work Place (PreventionProhibition and Redressal) Act 2013. Your Directors state that during the year underreview no cases of sexual harassment have been reported.
Further the company has complied with provisions relating to the constitution ofInternal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. The said Policy is available onCompanys website at http:// www.insecticidesindia.com/
33. Pollution Control
The Company has taken various initiatives to keep the environment free from pollution.It has already installed various devices in the factories to control the pollution.
34. Unclaimed Dividend
As per the Companies Act 2013 dividends that are unclaimed for a period of sevenyears statutorily get transferred to the Investor Education and Protection Fund (I EPF)administered by the Central Government. During the year under review in terms ofprovisions of Investors Education and Protection Fund (Awareness and Protection ofInvestors) Rules 2014 unclaimed dividend for financial year 2010-11 aggregating toRs.95285/- was transferred to Investors Education and Protection Fund. As per Regulation43 of the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 no shares are lying in the suspense account of theCompany.
The Company has taken the required insurance coverage for its assets against thepossible risks like fire flood public liability marine burglary etc.
36. Nature of Business
There is no change in the nature of business during the period under review.
37. Listing of Securities
The Companys equity shares are listed on BSE Limited & National StockExchange Limited.
38. Cautionary Statement
Statements in the Boards report and the Management Discussion and Analysis Reportdescribing the Companys objectives expectations or predictions may be forwardlooking within the meaning of applicable securities laws and regulations. Actual resultsmay differ materially from those expressed in the statement. Important factors that couldinfluence the Companys operations include: global and domestic demand and supplyconditions affecting selling prices new capacity additions availability of criticalmaterials and their cost changes in government policies and tax laws economicdevelopment of the country and other factors which are material to the business operationsof the Company.
Your Company has been able to perform efficiently because of the culture ofprofessionalism creativity integrity and continuous improvement in all functions andareas as well as the efficient utilization of the Companys resources for sustainableand profitable growth.
The Directors hereby wish to place on record their appreciation of the efficient andloyal services rendered by each and every employee without whose whole-hearted effortsthe overall satisfactory performance would not have been possible.
The Directors appreciate and value the contribution made by every member of the IILfamily.
Part "A": Subsidiaries - Not Applicable Part "B": Associates andJoint Ventures
Statement pursuant to Section 129 (3) of the Companies Act 2013 related to AssociateCompanies and Joint Ventures
1. Names of associates or joint ventures which are yet to commence operations. - NIL
2. Names of associates or jointventures which have been liquidated or sold during theyear.-NIL