Your directors are pleased to present the Thirty Seventh Annual Report
of the Company together with the Audited Accounts for the financial year ended March 31,
2023.
FINANCIAL RESULTS
| Particulars |
2022-23 |
2021-22 |
| Income from Operations |
582.25 |
541.89 |
| Other Income |
2.32 |
9.62 |
| Total Income |
584.57 |
551.51 |
| Profit before tax for the year |
102.22 |
94.31 |
| Less : Provision for taxation |
|
|
| Current Tax |
|
|
| in respect of current year |
27.50 |
24.95 |
| in respect of prior year |
NIL |
NIL |
| Deferred Tax |
(0.32) |
(1.31) |
| Profit after Tax |
75.04 |
70.67 |
| Add: OCI classified to |
|
|
| Retained Earnings |
0.09 |
0.47 |
| Add: Surplus brought forward |
113.74 |
80.72 |
| Less: Unrealised Fair Value gains not available for
appropriation |
(3.80) |
(2.61) |
| Total Amount available for dividend payout |
185.07 |
148.31 |
| Less: |
|
|
| IInterim Dividend (40%) paid on equity shares |
6.09 |
6.09 |
| Transfer to General Reserve |
25.00 |
25.00 |
| Final Dividend on Equity Shares paid for earlier year |
9.13 |
6.09 |
| Net Amount available for dividend payout |
144.85 |
111.13 |
| Surplus carried Forward to balance sheet |
148.65 |
113.74 |
Proposed dividend on equity shares has not been recognized as a
distribution of profit in the current years accounts in accordance with the Indian
Accounting Standard.
OPERATIONS REVIEW
Total income increased by 5.99 % to $ 584.57 crores in 2022-23 from $
551.51crores. The Profit after Tax for the year 2022-23 is $ 75.04 crores (previous year
2021-22
$ 70.67 crores), showing an increase of 6.18 %. With Fixed Assets of $
78.26 crores (previous year 2021-22 $ 82.01 crores), our Fixed Asset Turnover ratio is
healthy at 7.44 % with Return on Sales stood at 18.27%.
DIVIDEND
Dividend Distribution Policy
Pursuant to Regulation 43A of Listing Regulations, the Board adopted a
Dividend Distribution Policy, which had been placed on the website of the Company and can
be accessed at the link: https://www.avtnatural.com/policies/
Declaration and payment of dividend
Your Directors are pleased to recommend a final dividend of $ 0.60 per
share (60%) with face value of $ 1/- each on Equity Share Capital, for the year ended
31.03.2023, amounting to $ 913.70 Lakhs. During the year, the Board declared an Interim
Dividend of $ 0.40 per share (40%) with face value of $ 1/- each, amounting to $ 609.14
Lakhs. The aggregate of dividend declared during the year was
$ 1/-per share (100 %) with face value of $ 1/- each amounting to $
1522.84 Lakhs.
TRANSFER TO GENERAL RESERVE
Your directors are pleased to transfer a sum of $ 25 crore for the year
2022-23 (previous year $ 25 crore) to the General Reserve.
FINANCE
Cash and bank balances as at 31st March,2023 was
$ 534.92 lakhs (previous year $ 440.23 lakhs). The Company continues to
focus on the judicious management of its working capital, receivables, inventories and
other financial parameters and which were kept under strict check through continuous
monitoring.
The outstanding term loan from Federal Bank Limited as on 31st
March, 2023 is $ 11.80 crore, which is given in the note No. 16 to the financial
statements.
WINDMILL
The wind mill of the Company located at Kokkampalayam Village,
Dharapuram Taluk, Erode District, Tamil Nadu generated 842,083 units of electricity in the
year 2022-23 against 864,510 units generated in 2021-22. The Company utilised the 828,717
units, generated as captive consumption during 2022-23 for its Sathyamangalam factory.
BOARD MEETING
The Board of Directors met four times during the financial year. The
details of the Board meeting are given in the Corporate Governance report. The intervening
gap between the meetings were within the period stipulated under the Companies Act, 2013
and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
AUDIT COMMITTEE MEETING
The Audit Committee of the Company met four times during the current
financial year. The details of the Audit Committee meetings are given in the Corporate
Governance report. The intervening gap between the meetings were within the period
stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015.
PARTICULARS OF LOANS, GUARANTEE, OR INVESTMENTS
The Company has not given any loans or guarantees covered under the
provisions of section 186 of the Companies Act, 2013 and Schedule V of the Securities
Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations,
2015, except the Corporate Guarantee given on behalf of its wholly owned subsidiary
companies viz., AVT Natural Europe Limited, London and to AVT Natural S.A. DE C.V., Mexico
which is given in the note No. 37 to the financial statements.
The details of investments made by the Company are given in the note
No. 7 to the financial statements.
LISTING WITH STOCK EXCHANGES
The Company Shares are continued to be listed in both BSE Limited (BSE)
and the National Stock Exchange of India Limited (NSE). The Company has paid listing fees
up to 31st March 2024 to both the BSE Limited (BSE) and the National Stock
Exchange of India Limited (NSE).
DSIR APPROVAL FOR IN-HOUSE R&D FACILITY AT SOUTH VAZHAKULAM AND
BANGALORE
The approval by the Department of Scientific and Industrial Research
(DSIR), New Delhi for the Companys R&D facilities situated at South Vazhakulam,
Aluva, Kerala and the Manchenahaili Village, Kasabe Hobari, Bangalore are valid upto
31.03.2025.
MATERIAL CHANGES AND COMMITMENTS
There are no material changes or events that have occurred since the
date of the Balance Sheet which could have any effect on the financial position of the
Company.
DIRECTORS & KEY MANAGERIAL PERSONNEL
As on March 31, 2023, the Company has seven Non-Executive Directors out
of which five are Independent Directors. There are two women directors.
i) Director retiring by rotation
In accordance with the provisions of Companies Act, 2013 and the
Articles of Association of the Company, Mrs. Shanthi Thomas, Director retires by rotation
at the 37th Annual General Meeting and being eligible, offers herself for
re-appointment.
A resolution seeking shareholders approval for her reappointment along
with other required details forms part of the Notice.
ii) Declaration from Independent Directors on Annual Basis
The Company has received necessary declarations from all the four
Independent Directors of the Company under Section 149 of the Companies Act, 2013 that the
Independent Directors of the Company meet with the criteria of their Independence laid
down in Section 149 of the Companies Act, 2013 and Regulation 25(8) of the SEBI (LODR)
Regulations 2015.
iii) Key Managerial Personnel
As on March 31, 2023, the following were Key Managerial Personnel
("KMP") of the Company as per Sections 2(51) and 203 of the Act:
• Mr. B Krishna Kumar,
Sr. Vice President Operations & Manager
• Mr. A. Ramadas, Sr. Vice President and CFO
• Mr. Sharon Josh, Company Secretary.
PERFORMANCE OF SUBSIDIARY / JOINT VENTURE / ASSOCIATES
a) AVT Natural SA DE C.V., Mexico (AVTN)
AVT Natural SA DE C.V, Mexico has been established with an aim to
capture market for the Animal Nutritional products in South American market and other
markets.
The paid-up capital of the Company as on 31st March 2023 is
Mexican Peso (Mxn) 0.54 million and there is no change therein since then. AVTN is the
marketing arm of your Company for the animal nutrition products. The AVTN recorded sales
of $ 6.16 crores and Loss of $ 0.15 crores, for the year 2022-23.
b) AVT Natural Europe Limited, UK (AVTNEL)
The paid-up capital of the Company as on 31st March 2022 is
Pound Sterling (GBP) 1.535 million and there is no change therein since then. AVTNEL is
the marketing arm of your Company for de-caffeinated tea and instant tea. The AVTNEL
recorded sales of $ 107.82 crores (previous year $ 91.19 crores) and profit of $ 2.42
crores (previous year $ 3.38crores) for the year 2022-23.
c) AVT Natural FZCO (AVT Dubai)
A wholly owned subsidiary was incorporated by the company on 28th
March 2023 in Dubai, UAE for marketing the Animal nutrition products, Instant tea, food
additives, cosmetic and nutraceutical ingredients.
Mr. Rahul Thomas, relative of director ceases to be an employee of the
parent company w.e.f. 31.03.2023 and has been appointed as Director / General Manager in
the Subsidiary w.e.f. 01.04.2023.
Step down subsidiary Companies
AVT Natural Europe Limited, London has one wholly owned subsidiary AVT
Natural North America Inc.
i. AVT Natural North America Inc
The paid-up capital of the Company as on 31st March 2023 is
USD 60,000 and there is no change therein since. During the year, the company recorded
sales of $ 9.33 crores and profit of
$ 0.45 crores for the year 2022-23.
d) Accounts of subsidiaries
Pursuant to Section 136 of the Companies Act, 2013, a copy of the
audited financial statements of AVT Natural Europe Ltd., & AVT Natural S.A. DE C.V.,
for the period ended 31.03.2023, shall be provided to any shareholder, free of cost on
their request. The Audited financial statements are also available on the website of the
Company. The Consolidated financial statements, audited by the statutory auditors of the
Company, have been attached to this Report. Pursuant to Section 129(3) of the Companies
Act, 2013, a statement containing the salient features of the financial statements of
AVTN, AVTNEL & its step-down subsidiary in the prescribed Form AOC-1 is provided in
the Page No. 148 of Annual report.
e) Joint Venture / Associate Company
The Company does not have any Joint Ventures / Associate Companies
f) Policy for determining material subsidiary
The Company has a Policy for determining Material Subsidiary, which is
hosted on the Company website under the link www.avtnatural.com/investor_relations.
CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars prescribed by the Section 134 (3) (m) of the Companies
Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to
Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo are
furnished in the Annexure-I to this Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to the provisions of Section 135 of the Companies Act, 2013, a
CSR Committee comprising Board of Directors was formed to recommend,
i. The policy on Corporate Social Responsibility (CSR) and
ii. Implementation of the CSR Projects
Annual Report on CSR in the prescribed format is enclosed as
Annexure-II. The CSR policy of the Company has been uploaded on the website:
www.avtnatural.com / investor_relations.
CONTENTS OF CSR POLICY
The Companys CSR projects and programs focus on the holistic
development of host communities to create social, environmental and economic value to
society.
The Company will invest resources in any program such as skill
development, infrastructure development, women empowerment, Promotion of Health Care, Old
age homes / day care facilities for Senior Citizens, Education, Swatch Bharath, Flora
& Fauna and all other activities envisaged in the Schedule VII of the Companies Act,
2013.
STATUTORY AUDITORS
Pursuant to Section 139 and 142 of the Companies Act, 2013, the members
in their 36th Annual General Meeting held on 24.08.2022 appointed M/s. Suri
& Co, Chartered Accountant (Firm Registration No.004283S) as the Statutory Auditors of
the Company for a period of 5 years till the conclusion of the 41st Annual
General Meeting. In view of the amendment to the Companies Act, 2013 notified by the
Ministry of Corporate Affairs dated 7th May 2018, no longer their appointment
needs to be ratified by the Members.
AUDITORS REPORT
There are no qualifications or adverse remarks mentioned in the
Auditors report. The notes to accounts, forming part of financial statements, are
self-explanatory and need no further clarification.
SECRETARIAL AUDIT
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 has appointed Mr. V. Suresh & Associates, Practicing Company Secretaries (C.P.
No.6032), Chennai - 600 018 to undertake the Secretarial Audit of the Company.
The Secretarial Audit Report in form MR-3, submitted by the Secretarial
Auditors for the financial year 2022-23, is annexed to this report as Annexure - III and
forms an integral part of this Report.
There is no secretarial audit qualification, reservation or adverse
remarks in the Secretarial Report for the period under review.
During the year, the Company has complied with the Secretarial Standard
-1 (SS-1) and Secretarial Standard -2 (SS-2) issued by the Ministry of Corporate Affairs.
COST AUDIT REPORT
Cost Audit is not applicable to the Company as per the Companies (Cost
Records & Audit) Rules, 2014, however, the cost records are maintained by the Company.
REPORTING OF FRAUD
The Auditors of the Company have not reported any fraud as specified
under Section 143 (12) of the Companies Act, 2013.
INSURANCE
The Company continues to carry adequate insurance, for all assets,
against unforeseeable perils.
RELATED PARTY TRANSACTIONS
All transactions entered with related parties for the year under review
were at arms length basis and in the ordinary course of business and hence the provisions
of Section 188 of the Companies Act, 2013 are not attracted. There were no related party
transactions exceeding 10% of the annual consolidated turnover as per the last audited
financial statements during the year.
Further, there were no material related party transactions during the
year under review with the Promoters, Directors or Key Managerial Personnel or other
designated persons which may have a potential conflict in the interest with Company at
large, except the payment of remuneration of directors relative exceeding $ 30 lakhs per
annum, which was approved by the shareholders in its meeting held on 10.08.2017. The
disclosure of Related Party transactions to be provided under Section 134 (3)(h) of the
Companies Act 2013, read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form
AOC -2 is given in the Annexure - IV, forming part of this report.
As per the SEBI (Listing Obligations and Disclosure Requirements)
Regulations 2015, all the related party transactions were placed before the Audit
Committee and also the Board of Directors. Prior approval of the Audit Committee was
obtained on yearly / quarterly basis for the transactions entered with related parties,
except with the wholly owned subsidiary Companies, whose accounts are consolidated with
the Company. The transactions entered into pursuant to the omnibus approval so granted has
been placed before the Audit Committee and the Board of Directors for their approval on a
quarterly basis.
The Company has a Related Party Transaction policy and the same is
hosted on the website of the Company under the link www.avtnatural.com/investor_relations.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS AND COURTS
There are no significant material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and its future
operations.
ANNUAL RETURN
In terms of the requirements of Section 92(3) read with 134(3)(a) of
the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 the copy of the
Annual Return in prescribed format is available on the website of the Company
www.avtnatural.com/investor_relations.
STATUTORY INFORMATION
The information under section 197 of Companies Act 2013 and pursuant to
rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, are given in the Annexure - V.
The information required under section 197 (12) of the Companies Act
2013 readwith rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 in respect of the Company have been given in the Annexure -VI.
The statement containing remuneration paid to employees and other
details as required under Section 197(12) of the
Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure
forming part of this report. Further, the report and the accounts are being sent to the
members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said
annexure is open for inspection at the Companys Registered Office during, business hours
of all the working days of the Company, up to the date of the forthcoming Annual General
Meeting. Any member interested in obtaining a copy of the same may write to the Company
Secretary and the same will be provided free of cost to the member.
INDUSTRIAL RELATIONS
Your Company during the year under review, enjoyed cordial relationship
with technicians/workers and employees at all levels.
NOMINATION AND REMUNERATION POLICY
The Board on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection and appointment of Directors, Senior Management
Personnel, Key Managerial Personnel and their remuneration etc. A copy of the policy is
uploaded on the web site of the Company and the website link is www.avtnatural.com /
investor_relations.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Vigil Mechanism / Whistle Blower Policy in place
pursuant to Section 177 (9) of the Companies Act 2013 and as per the Regulation 22 of SEBI
(Listing Obligations and Disclosure Requirements) Regulations 2015. The said policy is
available on the website of the Company which can be accessed from the
link-www.avtnatural.com/investor_relations. During the year no instances of unethical
behavior were reported.
RISK MANAGEMENT
Pursuant to section 134(3)(n) of the Companies Act, 2013 and Regulation
21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board
of Directors has formed a Risk Management Committee to frame, implement and monitor the
risk management plan. The Committee is responsible for reviewing the risk management plan
and ensuring its effectiveness. The Committee considers the risks that impact mid to
long-term objectives of the business, including those reputational in nature. The Audit
Committee has additional oversight in the area of financial risks and controls.
The company has a risk policy defining risk management governance
model, risk assessment and prioritization process. The Risk Management Committee adopted a
follow-up risk management framework to review and monitor the key risks and their
mitigation measures periodically and provide an update to the Board on Companys risks.
The Audit Committee has an additional oversight on financial risks and controls.
ADEQUACY OF INTERNAL AUDIT AND INTERNAL FINANCIAL CONTROL
The Company has in place adequate Internal Audit and Internal Financial
Controls with reference to the financial statements, which is evaluated by the Audit
Committee as per Part C of Schedule II of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations 2015.
Apart from Statutory Audit, your Company, in compliance with Section
138 of the Companies Act, 2013, had engaged M/s Varma & Varma, Chartered Accountants,
Building No. 53/333, Off. Subash Chandra Bose Road, Vytilla Post, Kochi - 682 019, Kerala
as the Internal Auditors of the Company for the financial year 2022-23. Findings and
observations of the Internal Auditors are discussed, and suitable corrective actions are
taken as per the directions of the Audit Committee on an on-going basis to improve
efficiency in operations.
The Companys internal control systems are well established and
commensurate with the nature of its business and the size and complexities of operations
and adequate with reference to the financial statements as envisaged under the Companies
Act, 2013.
Your directors endorse that during the year under review, there were no
reportable material weaknesses in the present systems or operations of internal controls.
ENVIRONMENT AND SAFETY
The Company is conscious of the importance of environmentally clean and
safe operations. The Companys policy requires conduct of operations in such a manner, so
as to ensure safety of all concerned, compliances environmental regulations and
preservation of natural resources.
BOARD EVALUATION
The Board of Directors has made a formal annual evaluation of its own
performance and that of its committees, individual Directors & Manager, pursuant to
the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure
Requirements) Regulation, 2015. The evaluation was done based on the evaluation criteria
formulated by Nomination and Remuneration Committee which includes criteria such as
fulfilment of specific functions prescribed by the regulatory framework, adequacy of board
meetings, attendance and effectiveness of the deliberations etc.
Each Board member completed a questionnaire providing feed back on the
functioning and overall level of engagement of the Board and its committees on the
parameters such as the composition, execution of specific duties, contribution of new
ideas / insights, quality, quantity, and timeliness of flow of information, deliberations
at the meeting, independence / non-partis an approach in decision making etc.,
Independent Directors met on 13th February 2023 to review
performance evaluation of Non-Independent Directors and the entire Board of Directors
including the Chairman, Non-Executive Directors etc., The Independent Directors were
satisfied with the overall functioning of the Board, flow of information to the Board, its
various Committees and of the performance of other Non-executive Directors and the
Chairman of the Board.
DISCLOSURE OF ACCOUNTING TREATMENT
The Company has adopted the Indian Accounting Standards (Ind AS) with
effect from 1st April 2017, the Ind AS 115 with effect from 1st
April 2018 & the Ind AS 116 with effect from 1st April 2019 and all its
financial statements are made according to the said standards. Further, in the preparation
of the financial statements, the Company has followed the Accounting Standards referred to
in Section 133 of the Companies Act, 2013. The significant accounting policies which are
applied are set out in the Notes to the Financial Statements.
DEPOSIT FROM PUBLIC
The Company has not accepted any deposits from the public during the
year under review. No amount on account of principal or interest on deposits from the
public was outstanding as on March 31, 2023.
BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT
The Business Responsibility and Sustainability Report indicates the
Companys performance against the principles of the National Guidelines on Responsible
Business Conduct. This would enable the Members to have an insight into Environmental,
Social and Governance initiatives of the Company.
The Business Responsibility and Sustainability Report in compliance
with the regulation 34(f) of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations 2015 have been attached in the Annexure VII to this Report.
CORPORATE GOVERNANCE
Your Company has taken adequate steps to adhere to all the stipulations
laid down in Regulation 27 read with Part E of Schedule II and Schedule V of SEBI (Listing
Obligations and Disclosure Requirements) Regulations 2015 on corporate Governance. The
Management Discussion & Analysis Report, Report on Corporate Governance with Auditors
Certificate on compliance with conditions of Corporate Governance have been Annexed VII,
IX, X and XI to this Report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013.
The Company has in place an Anti-Sexual Harassment Policy in line with
the requirements of the Act and that an Internal Complaints Committee has been set up for
redressal of complaints and that all employees (permanent, contractual, temporary,
trainees) are covered under this policy.
During the year under review
Number of complaints received in the year: Nil Number of complaints
disposed off during the year: NA Number of cases pending for more than 90 days: Nil Number
of Workshop or awareness Program: Nature of Action taken by the employer or District
Officer: Nil
CAUTIONARY STATEMENT
Statements in this Directors Report & Management Discussion and
Analysis Report describing the Companys objectives, projections, estimates, expectations,
or predictions may be forward looking statements within the meaning of applicable
securities laws and regulations. Actual results could differ materially from those
expressed or implied. Important factors that could make difference to the Companys
operations include raw material availability and its prices, cyclical demand and pricing
in the Companys principle markets, changes in Government regulations, Tax regimes,
economic developments with in India and the countries in which the Company conducts
business and other ancillary factors.
During the year no application has been made and there are no
proceeding pending as per Insolvency and Bankruptcy Code 2016.
The Company has not raised funds through preferential allotment or
qualified institutions placement during the financial year 2022-23.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 (3) (c) of the Companies
Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed
that:
1. In the preparation of the accounts for the financial year ended 31st
March 2023, the applicable accounting standards had been followed along with proper
explanation relating to material departures;
2. The Directors have selected such accounting policies and applied
them consistently and 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 at the end of the
financial year and of the profit of the Company for that period;
3. The Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the provisions of this Act
for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities;
4. The Directors have prepared the accounts for the financial year
ended 31st March 2023 on a going concern basis.
5. The directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are adequate and are
operating effectively.
6. The directors have devised proper system to ensure compliance with
the provisions of all applicable laws and that such systems are adequate and operating
effectively.
ACKNOWLEDGEMENT
The Directors sincerely acknowledge the contribution and support from
customers, shareholders, farmers, BSE Ltd., National Stock Exchange of India Ltd., Cameo
Corporate Services Ltd., National Securities Depository Ltd., Central Depository Services
Ltd., and other stakeholders for the co-operation and assistance provided to the Company.
The Directors also place on record their gratitude to the employees for
their continued support, commitment, dedication and co-operation.
|
For and On behalf of the Board |
| Place : Chennai |
Ajit Thomas |
| Date : 30th May 2023 |
Chairman |
+91-9892691696
