Anjani Synthetics Ltd Directors Report.

Dear Members,

The Directors of your company have great pleasure in presenting the (36th) Thirty Sixth Annual Report together with the Audited Financial Statements of your Company for the financial year ended on 31st March 2020.

FINANCIAL SUMMARY

The summary of the companys financial performance of the Company during the financial year 2019-20 as compared to the previous financial year 2018-19 is given below:

[Rupees in Lacs]

Particulars Financial Year 2019-20 Financial Year 2018-19
Revenue from operations (Net) 32517.09 30694.53
Other income 111.21 84.67
Total Revenue 32628.30 30779.20
Expenses
(a) Cost of materials consumed 19846.71 19859.52
(b) Purchases of stock-in-trade - -
(c) Changes in inventories of FG, WIP & Stock-in-Trade 2024.11 (444.50)
(d) Employee benefits expense 904.41 978.11
(e) Finance costs 766.19 760.22
(f) Depreciation and amortization expense 445.35 536.03
(g) Other expenses 8163.61 8635.16
Total Expenses 32150.38 30324.54
Profit/ (Loss) before tax 477.92 454.66
Tax expense:
(a) Current tax expense 137.30 161.88
(b) Deferred tax (15.67) (7.67)
(c) Excess Provision of Tax for earlier Years (0.43) 0.35
Profit / (Loss) for the year 356.72 300.10
Earnings per share (face value Rs.10/-) Basic & Diluted 2.42 2.03

OPERATIONS REVIEW

The Companys total revenue from operations during the financial year ended 31st March 2020 were Rs. 32517.09 Lacs as against Rs. 30694.53 Lacs of the previous year with total expenses of Rs.32150.38 lacs (previous year of Rs. 30324.54 lacs).The Company has made Net Profit of Rs.356.72 Lacs as against Rs.300.10 Lacs of the previous year after considering Depreciation and Provision for Tax.

The EPS of the Company for the year 2019-20 is Rs. 2.42.

DIVIDEND

No dividend has been recommended in respect of the financial year ended 31st March, 2020 and the entire surplus be ploughed back into the business to give accelerator to the business of the company and generate higher profit in future.

EXPORTS

During the financial year, the Company has achieved export sales of Rs.815.37 Lacs (previous year of Rs. 1133.75 Lacs).

SUBSIDIARY, JOINT VENTURE (JV) AND ASSOCIATES COMPANIES

During the year under review, the Company does not have any Subsidiary, Joint Venture (JV) or Associates Company.

FIXED DEPOSIT

During the year under review, your Company has not accepted any fixed deposits within the meaning of Section 73 of the Companies Act, 2013 and the rules made there under.

SHARE CAPITAL & LISTING

During the year under review there is no change in Authorized Share Capital of the Company. The Authorized Share Capital of the Company as at 31st March, 2020 stood at Rs. 15,00,00,000/- divided into 1,50,00,000 equity shares of Rs. 10/- each. The paid up capital of the company as at 31st March, 2020 stood at Rs. 14,75,00,000/ - (Face value Rs.10/- each)

a) The Company does not have any equity shares with differential rights;

b) During the year under report, the Company has not issued any sweat equity shares;

c) During the year under report, the Company has not issued any ESOP;

d) Provision of money by Company for purchase of its own shares by employees or by trustees for the benefit of employees: The Company has not made any provision of money for the purchase of, or subscription for, shares in the Company, to be held by or for the benefit of the employees of the Company and hence the disclosure as required under Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014 is not required.

e) Listing with the stock exchanges : The Companys equity shares are listed on the Bombay Stock Exchange Limited (BSE) and it has paid the Annual Listing Fees for the financial year 2020-21

f) Disclosure with respect to shares transferred in IEPF Account: In terms of the provisions of Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, 12,514 shares whose dividends were unpaid/unclaimed for seven consecutive years taking the base year as Interim dividend for the FY 2007-08 were transferred during the year to the Investor Education and Protection Fund.

TRANSFER TO RESERVE

The Company has not transferred any amount to the General Reserve for the financial year ended 31st March, 2020.

CHANGE IN NATURE OF BUSINESS

During the period under review, there is no change in the nature of business.

DIRECTORS & KEY MANAGERIAL PERSONNEL

The Board of Directors of your company has various Executive and Non-Executive Directors including Independent Directors who have wide experience in different disciplines of corporate functioning.

During the year, Board of Directors has appointed Ms. Garima Jain in place of Mrs. Pooja Sharma as a Non Executive & Independent Woman Director of the company w.e.f. 15th June, 2019 with the approval of shareholders in the 35th Annual General Meeting.

Further, Mr. Konark P. Patel has resigned from the post of Company Secretary and Compliance officer of the company w.e.f 10th April, 2019 and Ms. Rachita Somani has been appointed as a Company Secretary and Compliance officer of the company w.e.f 09th August, 2019

As per the provisions of Section 152 of the Companies Act, 2013 and Articles of Association of the Company, Mr. Bhoorsingh Bagsingh Parihar [DIN: 01612692] being longest in the office shall retire at the ensuing Annual General Meeting and being eligible offers him-self for re-appointment.

The Board & Nomination & Remuneration Committee recommends the re-appointment of Bhoorsingh Bagsingh Parihar for your approval.

Brief details of Director proposed to be re-appointed as required under regulation 36 of the SEBI Listing Regulations are provided in the Notice of Annual General meeting.

All Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149 (6) of the Companies Act, 2013 and Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The terms and conditions of the Independent Directors are incorporated on the website of the Company www.anjanisynthetics.com.

DISCLOSURE RELATED TO BOARD AND COMMITTEES

a) Number of Board Meetings conducted during the year under review

Regular Board Meetings are held once in a quarter, inter-alia, to review the quarterly results of the Company.

During the year under review 6 (SIX) Board Meetings were convened. The intervening gap between the two meetings was within the period prescribed under the Companies Act, 2013. The details of the meetings are furnished in the Corporate Governance Report which forming part of this Annual Report.

b) Independent Directors Meeting

The Independent Directors met on the 13th February, 2020, without the attendance of Non-Independent Directors and members of the Management. The Independent Directors reviewed the performance of NonIndependent Directors and the Board as a whole; the performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors and assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

c) Committees of the Board of Directors

Your Company has several Committees which have been established as part of the best Corporate Governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

The Company has following Committees of the Board of Directors:

• Audit Committee

• Stakeholders Grievances and Relationship Committee

• Nomination and Remuneration Committee

The details with respect to the compositions, powers, and terms of reference and other information of relevant committees are given in details in the Corporate Governance Report which forms part of this Annual Report.

d) Board Evaluation:

Pursuant to the corporate governance requirements as prescribed in the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015, the Board of Directors has carried out an annual evaluation of its own performance, Board Committees and of individual directors. In a separate meeting of independent directors, performance of non-independent directors, performance of the Board as a whole, performance of the Committee(s) of the Board and performance of the Chairman was evaluated, taking into account the views of other directors. Performance evaluation of independent directors was done by the entire Board, excluding the independent director being evaluated.

e) Board Diversity

None of the Directors of the Company is disqualified for being appointed as Director as specified in Section 164(2) of the Companies Act, 2013.

VARIOUS COMPANIES POLICIES

In accordance with the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013 the Company has formulated and implemented the various policies. All the Policies are available on Companys website (www.anjanisynthetics.com) under the heading “Investor Relations”. The policies are reviewed periodically by the Board and updated based on need and requirements.

a) Policy on Directors Appointment and Remuneration

The Company has a Nomination and Remuneration Committee. The Committee reviews and recommend to the Board of Directors about remuneration for Directors and Key Managerial Personnel and other employee up to one level below of Key Managerial Personnel. The Company does not pay any remuneration to the

Non-Executive Directors of the Company other than sitting fee for attending the Meetings of the Board of Directors and Committees of the Board. Remuneration to Executive Directors is governed under the relevant provisions of the Act and approvals.

The Company has devised the Nomination and Remuneration Policy for the appointment, reappointment and remuneration of Directors, Key Managerial. All the appointment, reappointment and remuneration of Directors and Key Managerial Personnel are as per the Nomination and Remuneration Policy of the Company.

b) Vigil Mechanism

The Company has established a vigil mechanism and accordingly framed a Whistle Blower Policy. The policy enables the employees to report to the management instances of unethical behavior, actual or suspected fraud or violation of Companys Code of Conduct. Further the mechanism adopted by the Company encourages the Whistle Blower to report genuine concerns or grievances and provide for adequate safe guards against victimization of Whistle Blower who avails of such mechanism and also provides for direct access to the Chairman of the Audit Committee, in exceptional cases. The functioning of vigil mechanism is reviewed by the Audit Committee from time to time. None of the Whistle blowers has been denied access to the Audit Committee of the Board. The Whistle Blower Policy of the Company is available on the website of the Company www.anjanisynthetics.com.

c) Risk Management Policy

The Company is aware of the risks associated with the business. It regularly analyses and takes corrective actions for managing/ mitigating the same. The Company has framed a formal Risk Management Framework for risk assessment and risk minimization which is periodically reviewed to ensure smooth operation and effective management control. The Audit Committee also reviews the adequacy of the risk management framework of the Company, the key risks associated with the business and measure and steps in place to minimize the same.

d) Sexual Harrassment of Women at Workplace

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder. During the financial year 2019-20, the Company has not received any complaints on sexual harassment.

e) Contracts or Arrangements with Related Parties

All related party transactions entered into during the financial year were on an arms length basis and were in the ordinary course of business. Your Company had not entered into any transactions with related parties which could be considered material in terms of Section 188 of the Companies Act, 2013. Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC - 2 is attached. Suitable disclosure as required by the Indian Accounting Standard (Ind AS 24) has been made in the notes to the Financial Statements.

All Related Party transactions are placed before the Audit Committee for approval, wherever applicable. Prior omnibus approval for normal business transactions is also obtained from the Audit Committee for the related party transactions which are of repetitive nature and accordingly the required disclosures are made to the Committee on quarterly basis in terms of the approval of the Committee. The details of Related Party Transactions are given in the notes to the financial statements.

The policy on Related Party Transactions as approved by the Board of Directors is uploaded on the website of the Company www.anjanisynthetics.com

AUDITORS & AUDITORS REPORT

a) Statutory Auditors:

M/s. ABHISHEK KUMAR & ASSOCIATES, Chartered Accountants [FRN NO.: 130052W] was appointed as the Statutory Auditors of the Company, to hold the office from the conclusion of the 33rd Annual General Meeting (AGM) to the conclusion of the 38th Annual General Meeting (AGM), subject to ratification of the appointment by the members at every Annual General Meeting. The Company has received the consent from the Auditors and confirmation to the effect that they are not disqualified to be appointed as the Auditors of the Company in the terms of the provisions of the companies Act, 2013 and the rules made thereunder. Further they are holding a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI).

Accordingly, the Board of Directors had recommended the ratification of appointment of M/s. ABHISHEK KUMAR & ASSOCIATES, Chartered Accountants [FRN NO.: 130052W] as the Statutory Auditors of the Company to hold the office from the ensuing AGM till the conclusion of the next AGM on such remuneration as may be determined by the Board of Directors in consultation with them.

The Auditors report to the shareholders on the Standalone Financials for the year ended March 31, 2020 does not contain any qualification, observation or adverse comment.

The Statutory Auditors Report on the accounts of the Company for the accounting year ended 31st March, 2020 is self-explanatory and do not call for further explanations or comments that may be treated as adequate compliance of Section 134 of the Companies Act, 2013.

b) Internal Auditors:

M/s. Monika Bhandari & Co., Chartered Accountants, Ahmedabad has been appointed as Internal Auditors of the Company for the FY 2020-21. Internal Auditors are appointed by the Board of Directors of the Company on a yearly basis, based on the recommendation of the Audit Committee. The Internal Auditor reports their findings on the Internal Audit of the Company, to the Audit Committee on a yearly basis. The scope of internal audit is approved by the Audit Committee.

c) Cost Auditors:

The Company has appointed M/s. Kiran J. Mehta & Co., Cost Accountants, Ahmedabad as Cost Auditor of the Company to audit the cost accounts for the financial year 2020-21.

As per Section 148 read with Companies (Audit & Auditors) Rules, 2014 and other applicable provisions, if any, of the Companies Act, 2013 the Board of Directors of your Company has appointed M/s. Kiran J. Mehta & Co., Cost Accountants as the Cost Auditor of the Company for the financial year 2020-21 on the recommendations made by the Audit Committee subject to the approval of the Central Government.

The remuneration proposed to be paid to the Cost Auditors, subject to the ratification by the members at the ensuing Annual General Meeting, would be Rs.50,000/- (apart from reimbursement of out of pocket expenses and applicable taxes, if any).

The Cost Audit report for the financial year 2019-20 was filed within the due date. The due date for submission of the Cost Audit Report for the financial year 2020-21 is within 180 days from 31st March, 2020.

d) 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, your Company had re-appointed Mr. Mukesh H. Shah, Practicing Company Secretary of Ahmedabad to undertake the Secretarial Audit of the Company. The secretarial audit report for the financial year 2019-20 is annexed to this Annual Report as Annexure-III.

e) Details in respect of frauds reported by Auditors other than those which are reportable to the Central Government :

The Statutory Auditors of the Company have not reported any fraud to the Audit Committee or to the Board of Directors under Section 143(12) of the Companies Act, 2013 read with Rule 13 of the Companies (Audit and Auditors) Rules, 2014.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014 the extract of the Annual Return as on 31st March, 2020 in Form MGT-9 forms part of this Annual Report as Annexure-I.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO

Information relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo, required under Section 134 (3) (m) of the Companies Act, 2013 forms part of this Annual Report as Annexure- II.

CORPORATE GOVERNANCE REPORT

The Company has taken adequate steps to adhere to all the stipulations laid down under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. A report on Corporate Governance included as a part of this Annual Report is given in Annexure-IV.

A certificate from the Statutory Auditors of the company confirming the compliance with the conditions of Corporate Governance as stipulated under Reg. 27 & 34 the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached to this Annual Report.

CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION &ANALYSIS REPORT

Your Company is in compliance with all the applicable provisions of Corporate Governance as stipulated under Chapter IV of the Listing Regulations. A detailed report on Corporate Governance as required under the Listing Regulations is provided in a separate section and forms part of the Annual Report. Certificate from the Practicing Company Secretary regarding compliance with the conditions stipulated in the Listing Regulations forms part of the Corporate Governance Report.

The Management Discussion and Analysis Report as required under the Listing Regulations is presented in a separate section and forms part of the Annual Report.

INSURANCE

Assets of your Company are adequately insured against various perils.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments, affecting the financial position of the Company which has occurred between the end of financial year as on 31st March, 2020 and the date of Directors Report i.e. 25.08.2020.

COVID-19 PANDEMIC

The Covid-19 pandemic is the defining global health crisis of our time and is spreading very fast across the continents. But it is much more than a health crisis and is having an unprecedented impact on people and economies worldwide. The Company is taking all necessary measures in terms of mitigating the impact of the challenges being faced in the business. The Companys management has made initial assessment of likely adverse impact on business and financial risks on account of Covid-19, and that the management does not see any medium to long term risks in the Companys ability to continue as a going concern and meeting its liabilities and compliance, as applicable. Due to nationwide lockdown in India, the operations were disrupted at the plant and were remained shut from March 23, 2020 to May 30, 2020. In view of the outbreak of the pandemic, the Company undertook timely and essential measures to ensure the safety and well-being of all its employees and workers at its plant locations and corporate office. The Company observed all the government advisories and guidelines thoroughly and in good faith.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The details of Loans, Guarantees or Investments covered under the provisions of section 186 of the Companies Act, 2013 made during the year under review are disclosed in the financial statements.

PARTICULARS OF EMPLOYEES

Details pertaining to remuneration as required under section 197(12) of the companies act, 2013 read with rule 5(1) of the companies (appointment and remuneration of managerial personnel) rules, 2014:

a) The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary during the financial year 2019-20 and ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2019-20 are as under:

Remuneration Ratio of Directors/ KMP/ Employees:

Name & Designation

Remuneration Paid

+/- in remuneration 1 from previous year (Rs.)

latio/ Times per Median of employee remuneration

FY 2019-20 (Rs in lacs) FY 2018-19 (Rs in lacs)
Vasudev S. Agarwal Chairman & MD 24,00,000 24,00,000 - 521.97/5.21
Bhoorsingh B. Parihar Executive Director 3,23,430 159030 +1,64,400 13.48/0.13
Manoharlal I Sharma Chief Financial Officer 6,05,600 5,68,100 +37,500 131.70/1.31
Rachita Somani Company Secretary 2,52,995 - - 55.02/0.55
Konark P Patel Company Secretary - 69086 $ NA

Note : Except Key Managerial Personnel i.e. Managing Director, Chief Financial officer and Company Secretary, no other directors received any remuneration from the Company other than sitting fees for attending Board meetings and Committees meetings.

$ Details not given as Mr. Konark P Patel was a Company Secretary and Compliance Officer only for part of the financial year 2019-20 i.e up to 10th April, 2019.

* Details not given as Ms. Rachita Somani was not a Company Secretary and Compliance Officer in the financial year 2018-19. Ms. Rachita Somani was appointed as Company Secretary and Compliance Officer w.e.f. 09th August, 2019.

b) Median remuneration of employees was Rs. 459800/- during the year 2019-20

c) The particulars of the employees who are covered by the provisions contained in Rule 5(2) and rule 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as follows:

The number of permanent employees on the roll of Company: 182(One Hundred Eighty Two) as on 31 March, 2020.

d) It is hereby affirmed that the remuneration paid is as per the Nomination and Remuneration Policy for Directors, Key Managerial Personnel and other Employees.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate internal control system, which is commensurate with the size, scale and complexity of its operations. The Company has a process in place to continuously monitor existing controls and identify gaps and implement new and / or improved controls wherever the effect of such gaps would have a material impact on the Companys operation.

Further, the Internal Auditor monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with the operating systems, accounting procedures and policies of the Company. Based on the report of Internal Auditor, the process owners undertake the corrective action in their respective areas and thereby strengthen the Control. Significant audit observation and corrective actions thereon are presented to the Audit Committee of the Board.

DIRECTORS RESPONSIBILITY STATEMENT

As stipulated in Section 134(3)(c) read with sub section 5 of the Companies Act, 2013, Directors subscribe to the “Directors Responsibility Statement”, and confirm that:

a) In preparation of annual accounts for the year ended 31st March, 2020, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) The Directors had 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 or loss of the Company for that year;

c) The Directors had taken proper and sufficient care 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 Directors had prepared the annual accounts for the year ended 31st March, 2020 on going concern basis.

e) The Directors had laid down the internal financial controls to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively; and

f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

CORPORATE SOCIAL RESPONSIBILITY

During the financial year under review, the provisions of Section 135 of the Act relating to the Corporate Social Responsibility are not applicable to your Company.

COMPLIANCE WITH SECRETARIAL STANDARD

Your Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board and General Meetings.

GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Details relating to deposits covered under Chapter V of the Companies Act, 2013.

2. The Managing Director of the Company didnt receive any remuneration or commission from any of its subsidiaries.

3. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

ACKNOWLEDGEMENT

Your Directors would like to express their appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review Your Directors place on record their deep appreciation to employees at all levels and workers for their hard work, dedication and commitment.

By Order of the Board
For, ANJANI SYNTHETICS LIMITED
Place : Ahmedabad
Date : 25th August, 2020
VASUDEV S. AGARWAL
(DIN: 01491403)
CHAIRMAN & MD