baheti metal & ferro alloys ltd share price Directors report


<dhhead>DIRECTORS REPORT</dhhead>

Dear Shareholders;

Your Directors are pleased to present the Annual Report together the Audited Financial Statements of your Company for the financial year ended March 31, 2023:

1. FINANCIAL PERFORMANCE

The Audited Financial Statements of your Company as of March 31, 2023 have been prepared in accordance with the relevant applicable Accounting Standards, Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), and the applicable of the Companies Act, 2013 ("Act").

(Rs. in Lakhs)

Particulars

Year ended March 31, 2023

Year ended March 31, 2022

Revenue from Operations

35,996.29

24,839.76

Other Income

60.11

86.26

Total Revenue

36,056.38

24,926.04

Earnings Before Interest, Depreciation and Amortization Expense and Taxes

1348.79

830.46

Less:- A) Finance Cost

572.83

348.95

Less:- B) Depreciation and Amortization Expense

80.25

74.88

Profit / (Loss) before Extra-Ordinary Items and tax

695.77

405.64

Add/(Less): Extra-Ordinary Item

-

-

Profit/(Loss) after Extra Ordinary Items and before tax

695.77

405.64

Total Tax Expense

167.36

112.69

Share of Associates Profit

-

-

Profit / (Loss) After Tax

528.40

292.95

Earnings Per Share

Basic / Diluted (Amount in Rs.)

6.81

6.42

2. Performance Review & State of Companys Affairs:

For the year ended 31st March, 2023 the company has achieved a Revenue of Rs. 35,996.29 Lacs, and it has shown the uptrend by 44.91% over the last year of Rs. 24,839.76 Lacs. The profit after tax for the year was Rs. 528.40 Lacs, registering the uptrend growth of 79.76% over the profit of Rs. 293.94 Lacs in Financial Year 2021-22.

3. DETAILS OF SUBSIDIARY/ JOINT VENTURE/ ASSOCIATE COMPANIES

Company does not have any Subsidiary, Joint venture or Associate Company.

4. CHANGE IN NATURE OF BUSINESS

During the financial year ended March 31, 2023, there has been no change in the Companys nature of business.

TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3)(J) OF THE COMPANIES ACT, 2013

The Board of Directors of the Company has decided not to transfer any amount to the Reserves for the year under review.

LOANS, GUARANTEES AND INVESTMENTS

Details of loans and guarantees given, investments made and securities provided, if any, as covered under the provisions of Section 186 of the Act are disclosed in the notes to the financial statements.

MANAGEMENT DISCUSSION & ANALYSIS

(a) Industry Structure and Developments:

Aluminium is more environment-friendly than steel, plastic and other materials. It has widespread uses throughout the economy and is equally important to both the industrial and consumer sectors. Key sectors to drive aluminium consumption in India are Auto, Power, Electronics, Railways, Aerospace & Defence Construction, Solar Energy and Aluminium packaging. Aluminium is 100% recyclable and consumes 95% less energy and releases 95% less greenhouse gases as compared to primary aluminium and there is no loss of properties or quality during the recycling process.

Indias economy has significant growth potential driven by various factors, i.e. urbanization, growing digital economy, initiatives like "Make in India", increase of infrastructure projects, agriculture modernization, attracting foreign investment, ease of doing business, healthcare and pharmaceuticals services, expanding international trade and participating in global supply chains, tourism and advancements in space technology & satellite communication. India is one of the fastest growing economies globally, in addition to also being one of the fastest emerging markets. Thus, there is a vast scope for the industry to develop under the current scenario.

The Indian economy performed exceptionally well compared with the rest of the world. India is set to remain the bright spot in CY 2023 with a potential to contribute 15% to the global GDP growth, according to IMF. In December 2022, India also assumed G20 presidency with an ambition to unite the world under the theme "Vasudhaiva Kutumbakam" or "One Earth - One Family - One Future". This is an opportunity to showcase the nations global leadership amidst growing uncertainty and economic crisis.

The Company is involved primarily in segment of manufacturing and trading of non-ferrous metals although major part of the business is covered by aluminium products. Companys main products line includes Aluminium Wire Rod, Aluminium Deox, Cored Wire, Aluminium Alloy Ingots, Ferro Titanium, and Conductor & Cables. The Company is operating in multiple products of aluminium and this multiplicity of operations minimizes the operating eventualities. A considerably wide geographical presence and reach, both domestic and international, have helped the Company to attempt de-risking its business and meet the risks with suitable precaution. Your company is well positioned to capitalize on emerging opportunity due to significant competitive strength, acquired over the years.

(b) Opportunities & threats:

Opportunities

India continues to forge ahead on its path of progress, creating remarkable opportunities for the non-ferrous metal sector. Non-Ferrous Metal Industry is one of the key sectors of Indian economy contributing significantly to nations GDP and providing employment to large number of people, directly or indirectly as it meets the requirements of wide range of key industries and also plays vital role for countrys vision for Aatmanirbhar Bharat. The Government of India continues to enhance international co-operation for promoting FDI and improve ease of doing business in the country.

GDP growth rate in FY 2024 expected to be 5.9%, lower than the FY 2023 growth of 6.8% due to subdued external demand and tightening monetary policy. However, India will remain the fastest growing major economy. Brent oil prices are expected to remain range bound in 2023, given the continuing war in Ukraine and sanctions imposed in response by the USA and European Union. India meets nearly 80% of its oil needs through imports. High oil prices will also have a trickledown effect on the prices paid by consumers for goods and services. Persistent inflation resulted in RBI to increase the repo rate by 250 basis points throughout FY 2022-23. Further rate hikes are expected in the coming year, despite no rate hike in the April-23 Monetary Policy Committee meeting.

Indias manufacturing sector also outperformed the rest of the world, projecting the country as a potential manufacturing hub. Stable political conditions, supportive policy schemes, strong domestic consumption and growing presence of skilled professionals support this ambition. The GOIs focus to make the country an attractive destination for business has been a key enabler of robust economic performance.

In FY 2022-23, the Company delivered a resilient and strong performance, despite macroeconomic challenges, tough market conditions and global uncertainties. The Company has achieved sales of worth 35,996.29 Lakhs. The Company has significant spare capacity to increase its production and sales level. Accordingly, the Company has geared-up its marketing and production activities. This performance was mainly driven by higher volumes and better product mix, lower input costs, stability in operations and cost-saving actions.

Our business strategy prioritizes reaching our goals in a maximally responsible manner. We recognise the value of a diverse workforce. We remain committed to make an even bigger difference by reimagining and improving our work, investing in our people and welding a sustainable future.

Threats

When you grab the opportunities based on your strength, you are bound to be accompanied by the risks and threats attached with them. The Company is exposed to the following type of risks.

? Economic Downturns

? Market Competition

? Cyber Security Threats

? Reputational Damage

? Technological Disruption

? Natural Disasters

? Regulatory Changes

? Financial Risks

? Supply Chain Disruptions

? Global Events

? Employee Issues

? Environmental Concerns

? Supplier Reliability

? Political Instability

? Imposition of High Import Tariffs & Customs Duties

These factors can be main drivers behind the pressure on the Company in terms of operation and profitability

(c) Segment-wise Performance:

The company is primarily engaged in the business of manufacturing and trading of non-ferrous metal, which constitute a single reportable segment.

(d) Outlook:

Last year was economically a challenging one, due to the various impact of COVID, supply chain disruptions, coupled with rising input costs and diesel prices on the back of geopolitical crisis. India continues to be the preferred hub of global companies across a wide range of industries due to multiple capabilities and low costs. India has become the innovation partner of many global companies due to its unique value proposition. India continues to offer innovative business models to lessen the impact of the economic downturn. This confirms the market is in a strong position to perform throughout the year.

(e) Risk and concerns:

The Company recognizes that risk is an integral part of business and it is committed to manage the risks in a proactive and efficient manner. Risk evaluation and management is an ongoing process within the Organization. The state of external environment, including factors like interest rates, inflation, and growth in economic activity, rationalization of tax structure, job creation & retention of manpower and consumer sentiment continues to be the biggest source of threat as well as opportunity for the Company. Any slowdown in the economic activity in the Country, significant job losses or high rates of inflation can severely impact the consumption and therefore growth of the Company.

The Companys business is exposed to many internal and external risks and it has consequently put in place robust systems and processes along with appropriate review mechanism to actively monitor, manage and mitigate these risks. The Company takes a structured approach to the identification, quantification and hedging of such risks by developing comprehensive Risk Management Policy of the Company which is periodically reviewed by the management.

(f) Internal control systems, its adequacy and risk management:

Your Company maintains effectively and efficiently laid down policies, guidelines and procedures keeping in mind the nature, size and intricacy of Companys business objectives. The Company positively ensures strict adherence to various procedures, laws, rules and statutes. Internal Control Systems are implemented:

• To safeguard the Companys assets from loss or damage.

• To keep constant check on cost structure.

• To provide adequate financial and accounting controls and implement accounting standards.

The Audit Committee reviews the adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations. During the year, the Company has taken steps to review and document the adequacy and operating effectiveness of internal controls. Nonetheless, your Company recognizes that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

The Company ensures the periodical Internal Audit is conducted by an independent auditor, whose report is submitted to the Audit Committee and Board of Directors for consideration. During the financial year 2022-23, no significant deficiencies/material weaknesses that might impact financial statements have been reported by the Internal Auditor as at the Balance Sheet date.

(g) Financial performance with respect to operational performance:

During the year under review, the revenue from operation of the Company was stood at INR 35,996.29 Lakh as against that of INR 24,839.76 Lakh for previous year. Revenue from operation of the Company was increased by 44.91% over previous year.

Profit before Tax for the financial year 2022-23 stood at INR 695.77 Lakh as against Profit before Tax of INR 405.64 Lakh making the net profit of INR 528.40 Lakh for the financial year 2022-23 as against the net profit of INR 292.95 Lakh for the financial year 2021-22. Due to increase in raw material prices, operating and other expenses, the Company could not generate the more profit even though increase in revenue from operations.

The Board is making its continuous efforts for re-visiting the purchase policy of the Company and increasing the capacity utilization of manufacturing capacity and thereby achieving reduction in the fixed cost and manual intervention in the production will lead the Company to generate the profit in the coming years.

Financial Highlights for operating performance of financial year 2022-23:

(Rs. In lacs)

Particulars

2022-23

2021-22

Total Income

36,056.39

24,926.03

PBT

695.77

405.64

PAT

528.40

292.95

The financial ratios are mentioned as in the notes to accounts section.

(h) Material developments in Human Resources, Industrial Relations, and Health, Safety & Environment:

The company believes that the human capital is the key contributor for the business growth and competitiveness. This includes not only the employees of the Company, but the skilled labour engaged at our factory units and through sub-contracting.

The number of employees as on 31st March, 2023 was 256 against 240 employees on the pay roll of the company during the previous financial year.

The company has during the year under review maintain excellent industrial relations at all levels. This has ensured that we have a committed and dedicated workforce with a high level of fervor.

(i) Key Financial Ratios for 2022-23 compared with 2021-22

Sr.

No.

Particulars

2022-23

2021-22

1.

Current Ratio

1.46

1.28

2.

Debt Equity Ratio

2.06

3.03

3.

Debt Service Coverage Ratio

2.06

2.05

4.

Return on Equity Ratio

70.77%

70.46%

5.

Inventory Turnover Ratio

8.47

9.17

6.

Trade Receivable Turnover Ratio

7.80

7.80

7.

Trade Payable Turnover Ratio

22.99

21.69

8.

Net Capital Turnover Ratio

9.77

15.31

9.

Net Profit Ratio

1.47%

1.18%

10.

Return on Capital Employed

12.02%

11.18%

SHARE CAPITAL STRUCTURE OF THE COMPANY

During the year under review, the Company has increased its Authorised Share Capital and Paid Up Capital in compliance with applicable provisions of the Companies Act, 2013, year end share capital is mentioned hereunder:

a) Authorized Capital:

Rs. 10,50,00,000/- (Rupees Ten Crore Fifty Lakhs Only) divided into 1,05,00,000 (One Crore Five Lakhs) Equity Shares of Rupees 10 /- each.

b) Issued Capital, Subscribed and Paid-up Capital:

Rs. 10,36,85,300/- (Rupees Ten Crore Thirty Six Lakhs Eighty Five Thousand Three Hundred Only) divided into 1,03,68,530 (One Crore Three Lakh Sixty Eight Thousand Five Hundred Thirty) Equity Shares of Rupees 10 /- each.

DIVIDEND

The Board of Directors of your company, after considering holistically the relevant circumstances, has decided that it would be prudent, not to recommend any Dividend for the year under review.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company did not have any funds lying unpaid or unclaimed for a period of seven years. Therefore, there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF).

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(C) of the Act the Board of Directors of the Company confirms that:

a) In the preparation of the annual accounts for the year ended 31st March, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

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 of the company for that period;

c) 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;

d) the directors had prepared the annual accounts on a going concern basis;

e) the directors had laid down 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.

BOARD OF DIRECTORS, BOARD & COMMITTEE MEETINGS AND KEY MANAGERIAL PERSONNEL

• BOARD COMPOSITION

The Company has a balanced board with optimum combination of executive and non-executive directors including independent directors, which plays a crucial role in board processes and provides independent judgment on issues of strategy and performance. The board of directors of the Company consist of eminent individuals from diverse fields having experience and expertise in their respective fields. As on March 31, 2023, board comprises of 6 (six) directors out of which 3 (three) are executive directors, 3 (Three) are non-executive directors including 2 (Two) independent directors. Independent Directors are appointed in compliance with the applicable provisions of the Act, as amended from time to time. The maximum tenure of the independent directors is in compliance with the Act.

None of the directors on the board holds the directorship in more than 20 (twenty) companies and out of them none of the directors holds the directorship in more than 10 (ten) public companies at a time, pursuant to Regulation 165 of the Act.

The table below gives the composition of the Board and the directorships held by each of the directors of the Company at the end of Financial Year 2022-23:

Name of Director

Category

Date of Appointment

Number of Shares held in the Company

Mr. Balkishan Shankerlal Shah Managing Director (DIN: 03006486)

Promoter Executive

10/10/2017

15,00,000

Mr. Yash Shankerbhai Shah Joint Managing Director (DIN: 09527701)

Promoter Executive

07/03/2022

15,00,000

Mr. Shankerlal Bansilal Shah Whole-Time Director (DIN: 00131715)

Promoter Executive

28/12/1994

28,84,000

Mrs. Ayushi Yash Shah Director

(DIN: 09527729)

Promoter Group NonExecutive Director

07/03/2022

3,31,990

Mr. Satya Narain Mittal Director

(DIN: 09533705)

Non-Executive

(Independent)

25/03/2022

 

Mr. Jaimish Govindbhai Patel Director

(DIN: 09647742)

Non-Executive

(Independent)

27/06/2022

 

As on March 31, 2023, none of the Directors of the Company were related to each other except Mr. Balkishan Shankerlal Shah, Managing Director, Mr. Yash Shankerbhai Shah, Joint Managing Director, Mr. Shankerlal Bansilal Shah, Whole-Time Director and Mrs. Ayushi Yash Shah, Director who are related to each other as per the provisions of the Act.

MEETINGS OF THE BOARD OF DIRECTORS

• During the financial year ended March 31, 2023, 14 (Fourteen) meetings of board of directors of the Company.

• The intervening gap between the Meetings was within the period prescribed under the Act.

• The following meetings of the Board of Directors were held during the financial year ended March 31, 2023:

The following Meetings of the Board of Directors were held during the Financial Year 2022-23:

SN

Date of Meeting

Board Strength

No. of Directors Present

1

08/04/2022

7

7

2

20/04/2022

6

6

3

27/05/2022

6

5

4

18/06/2022

6

5

5

24/06/2022

6

5

6

27/06/2022

5

5

7

05/07/2022

6

5

8

12/07/2022

6

5

9

09/09/2022

6

6

10

24/09/2022

6

6

11

27/09/2022

6

5

12

22/11/2022

class=MsoNormal align=right style=margin-top:3.0pt;margin-right:0cm; margin-bottom:3.0pt;margin-left:0cm;text-align:right>6

6

13

06/12/2022

6

6

14

20/03/2023

6

6

SN

Name of Director

Board Meeting

AGM

(30/09/20

22)

No. of Meeting Entitled to Held

No. of Meeting attended

%

1

Mr. Balkishan Shankerlal Shah

14

14

100.00

Yes

2

Mr. Shankerlal Bansilal Shah

14

14

100.00

Yes

3

Mr. Yash Shankerlal Shah

14

14

100.00

Yes

4

Mrs. Ayushi Yash Shah

14

14

100.00

Yes

5

Mr. Satya Narain Mittal

14

11

78.57

Yes

6

Mr. Prithviraj Dhariwal

04

01

25.00

No

7

Mr. Jaimish Govindbhai Patel

08

08

100.00

No

8

Mr. Gopallal Laxminarayan Bangur

01

01

100.00

No

9

Mr. Kushal Omprakash Maheshwari

01

01

100.00

No

• CHANGE IN DIRECTORS

During the year under review, Mr. Kushal Maheshwari (DIN: 08481581), Non-Executive & Independent Director and Mr. Gopallal Laxminarayan Bangur (DIN: 08481541), Non-Executive & Independent Director have resigned with effect from April 20, 2022.

Mr. Prithviraj Dhariwal (DIN: 02772870) who was appointed as Non-Executive and Independent Director of your Company with effect from April 08, 2022 has resigned with effect from June 22, 2022.

Mr. Jaimish Govindbhai Patel (DIN: 09647742) was appointed as Non-Executive and Independent Director of your Company with effect from June 27, 2022. In the opinion of the Board, the aforesaid Director possesses the integrity, expertise and experience (including proficiency) required for appointment as Independent Director of the Company.

• DIRECTOR RETIREMENT BY ROTATION

Mr. Shankerlal Bansilal Shah (DIN: 00131715) Director of the Company who is liable to retire by rotation pursuant to the provisions of Section 152(6) of the Act and offer himself for reappointment, subject to the approval of the members at the ensuing Annual General Meeting.

• DECLARATION OF INDEPENDENCE BY INDEPENDENT DIRECTORS

The Company has received the necessary declarations from the independent directors of the Company in accordance with Section 149 (7) of the Act confirming that they meet the criteria of independence prescribed under the Act. All the Independent Directors have also confirmed that in terms of Rule 6 (3) of the Companies (Appointment and Qualification of Directors) Rules, 2014, they have registered themselves with the Independent Directors database as prescribed under the Act.

In the opinion of the board, there has been no change in the circumstances which may affect their status as independent directors and the board is satisfied of the integrity, expertise and experience (including proficiency in terms of Section 150 (1) of the Act and applicable rules thereunder) to all independent directors on the board.

• DISQUALIFICATIONS OF DIRECTORS

During the financial year 2022-2023 under review the Company has received Form DIR-8 from all Directors as required under the provisions of Section 164(2) of the Act read with Companies (Appointment and Qualification of Directors) Rules, 2014 that none of the Directors of your Company is disqualified; to hold office as director disqualified as per provision of Section 164(2) of the Act and debarred from holding the office of a Director pursuant to any order of the SEBI or any such authority in terms of SEBI letter dated June 14, 2018 and NSE circular dated June 20, 2018 on the subject "Enforcement of SEBI orders regarding appointment of Directors by Listed Companies".

The Directors of the Company have made necessary disclosures, as required under various provisions of the Act.

• KEY MANAGERIAL PERSONNEL

Pursuant to provisions of Sections 2(51) and 203 of Act read with Rule 8 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, the following persons are to be Key Managerial Personnel of the company;

a. Mr. Shankerlal Bansilal Shah, Chairman and Whole-Time Director

b. Mr. Balkishan Shankerlal Shah, Managing Director

c. Mr. Yash Shankerlal Shah, Joint Managing Director

d. Mr. Manojkumar Jagdishchandra Shah, Chief Financial Officer

e. Mrs. Mansi Harsh Darji, Company Secretary

The Board of Directors has appointed Mrs. Mansi Harsh Darji as a Company Secretary & Compliance Officer of the Company w.e.f. June 01, 2022 who is a Key Managerial Personnel as per Section 203 of the Act. Apart from the said change, there is no other change in the Key Managerial personnel of the Company during the year under review.

• COMMITTEES OF THE BOARD

The Board receives regular communication regarding policy-related issues as well as other pertinent and important information. Your board currently has three (3) committees, namely the Audit Committee, the Nomination and Remuneration Committee, and the Stakeholder Relationship Committee, to look into various aspects for which they have been established in order to provide better corporate governance and transparency. The terms of reference of these committees are in line with Act.

1. AUDIT COMMITTEE

The Audit Committee of the Board of Directors was constituted with the requirement of the Section 177 of the Act and Regulation 18 of Listing Regulations.

During the year under review, four meetings of the Audit Committee were held i.e. on July 20 2022, September 09 2022, December 06 2022, March 20 2023. The intervening gap between two meetings did not exceed one hundred and twenty days.

The details of the Audit Committee meetings attended by its members during FY 2022-23 are given below:

Sr.

No.

Name of Director

Category / Nature of Directorship

Number of Meetings held during the FY 2022-23

Percentage

of

attendance

Held

Attended

1.

Mr. Satya Narain Mittal

Chairman, NonExecutive Independent Director

4

4

100.00

2.

Mr. Jaimish Govindbhai Patel

Member, NonExecutive Independent Director

4

4

100.00

3.

Mr. Shankerlal Bansilal Shah

Member, Executive Director

4

4

100.00

The Chief Financial Officer was invited to attend the audit committee meetings. The Company Secretary of the Company acts as Secretary of the Committee. The Board of Directors has taken note of and accepted the observations and recommendations made by the Audit Committee.

2. NOMINATION AND REMUNERATION COMMITTEE

The Company has constituted a Nomination and Remuneration Committee pursuant to the provisions of Regulation 19 of Listing Regulations and Section 178 of the Act.

During the year under review, one meeting of the Nomination and Remuneration Committee were held i.e. on September 09 2022.

The details of the Nomination and Remuneration Committee meetings attended by its members during FY 2022-23 are given below:

Sr.

No.

Name of Director

Category / Nature of Directorship

Number of Meetings held during the FY 202223

Percentage

of

attendance

Held

Attended

1.

Mr. Satya Narain Mittal

Chairman, NonExecutive Independent Director

1

1

100.00

2.

Mr. Jaimish

Govindbhai

Patel

Member, NonExecutive Independent Director

1

1

100.00

3.

Mrs. Ayushi Yash Shah

Member, NonExecutive Director

1

1

100.00

The Company Secretary of the Company acts as Secretary of the Committee.

3. STAKEHOLDERS RELATIONSHIP COMMITTEE

The Company has constituted a Stakeholders Relationship Committee pursuant to the provisions of Regulation 20 of Listing Regulations and Section 178(3) of the Act.

During the year under review, one meeting of the Stakeholders Relationship Committee was held i.e. on March 20, 2023.

The details of the Nomination and Remuneration Committee meetings attended by its members during FY 2022-23 are given below:

Sr.

No.

Name of Director

Category / Nature of Directorship

Number of Meetings held during the FY 2022-23

Percentage

of

attendance

Held

Attended

1.

Mr. Satya Narain Mittal

Chairman, NonExecutive Independent Director

1

1

100.00

2.

Mr. Jaimish Govindbhai Patel

Member, NonExecutive Independent Director

1

1

100.00

3.

Mr. Shankerlal Bansilal Shah

Member, NonExecutive Independent Director

1

1

100.00

The Company Secretary of the Company acts as Secretary of the Committee.

During the year under review, the Company has not received any investor complaints from its shareholders.

CORPORATE GOVERANCE

In line with Regulation 15(2) of the Listing Regulations, the provisions of Corporate Governance shall not apply in respect of the following class of the Companies:

a. Listed entity having paid up equity share capital not exceeding Rs. 10 Crore and Net worth not exceeding Rs. 25 Crore, as on the last day of the previous financial year;

b. Listed entity which has listed its specified securities on the SME Exchange.

Since, our Company falls in the ambit of aforesaid exemption (b); hence compliance with the provisions of Corporate Governance shall not apply to the Company and it does not form the part of the Annual Report for the financial year 2022-23.

POSTAL BALLOT

During the financial year ended March 31, 2023, there are no special resolution was required to be put through postal ballot.

DISCLOSURE UNDER RULE-5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION) RULES, 2014

Disclosure required under Section 197(12) of the Act read with Rule-5 of the Companies (Appointment and Remuneration) Rules, 2014 have been annexed as Annexure-B. No employee of the Company was in receipt of the remuneration exceeding the limits prescribed under Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, hence, not applicable to the Company.

EXTRACT OF ANNUAL RETURN

In compliance with Section 92(3) and 134(3)(a) of the Act, Annual Return is uploaded on Companys website and can be accessed at www.bahetiindustries.com.

AUDITORS:

• STATUTORY AUDITOR

Pursuant to Section 139 of the Act read with rules made thereunder, as amended, M/s. Wadhawan & Co., Chartered Accountants (Firm Registration No. 129455W), were appointed as the Statutory Auditors of your Company for a term of five years beginning from the conclusion of Annual General Meeting held in year 2020 till the conclusion of Annual General Meeting held in year 2025 (AGM).

The Board has taken note and M/s Wadhawan & Co., Chartered Accountants, have confirmed their eligibility under section 141 of the Companies Act, 2013 and the Rules framed thereunder as Statutory Auditors of the company. As required under Listing Regulations, the Auditors have also confirmed that they hold a valid certificate issued by the peer review Board of the Institute of Chartered Accountants of India.

There are no qualifications, reservations or adverse remarks or disclaimers made by the auditors in their report on the financial statements of the company for the financial year ended 31st March, 2023. The notes on the Financial Statements referred to in the Auditors Report are self-explanatory and do not call for any comments or explanations.

• SECRETARIAL AUDITOR

Pursuant to requirement of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the company has appointed M/s Rutul Shukla & Associates, Practicing Company Secretaries (COP: 7470), to undertake the Secretarial Audit and to provide Annual Secretarial Compliance Report of the company for the financial year 2022-23. Secretarial Audit Report is given by M/s Rutul Shukla & Associates, Practicing Company Secretaries and is attached herewith as Annexure-D.

The observations referred to in the Secretarial Audit Report are self-explanatory and do not call for any comments or explanations.

• INTERNAL AUDITOR

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 Auditors report their findings on the internal audit of the Company, to the Audit Committee on a periodic basis. The scope of internal audit is approved by the Audit Committee.

DISCLOSURE, AS TO WHETHER MAINTENANCE OF COST RECORDS:

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, (including any statutory modifications and re-enactments thereof) the cost audit records maintained by the company in respect of goods manufactured by the Company is required to be audited.

As per the requirement of Section 148(3) of the Companies Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Board of Directors have, based on the recommendation of the Audit Committee, appointed Anuj Aggarwal & Co., Cost Accountant, Ahmedabad (Firm Registration No. 102409) to audit the cost accounts of the company for the financial year 2022-23. As required under the Act, necessary resolution seeking members ratification for the remuneration payable to Anuj Aggarwal & Co., is forming part of the notice convening Annual General Meeting of the company for the financial year 2022-23.

The Cost Audit Report for the financial year 2022-23 will be submitted to the Central Government in the prescribed format.

REPORTING OF FRAUD

In pursuance to the provisions of Section 143(12) of the Act, the Statutory Auditors had not reported any incident of frauds (other than those which are reportable to the Central Government) to the Board of Directors of the Company during the financial year under review.

INTERNAL FINANCIAL CONTROLS & THEIR ADEQUACY

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the relevant board committees, including the audit committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during FY 2022-23.

COMPLIANCE WITH SECRETARIAL STANDARDS

During the year under review, the company has complied with the provisions of Secretarial Standards issued by Institute of Company Secretaries of India to the extent applicable.

DEPOSITS

During the year under review, the Company has not accepted any deposit during the financial year under review.

There was unsecured loan accepted by the Company from its Directors during the year under review under sub-rule 1 clause (C) sub-clause (viii) of rule 2 of Companies (Acceptance of Deposits) Rules 2014.

RELATED PARTY TRANSACTIONS

All contracts/arrangements/transactions entered by the Company during the FY 2022-23 with related parties were in compliance with applicable provisions of the Act and on an arms length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with the Promoters, Directors, Key Managerial Personnel, or other designated persons which may have potential conflict with the interest of the Company at large.

All related party transactions are placed before the Audit Committee as also the Board for approval. The Company has developed a Related Party Transaction Policy for the purpose of identification and monitoring of such transaction. The Related Party Transaction policy is placed on the Companys website i.e. www.bahetiindustries.com.

Particulars of Contracts or arrangements with Related Parties referred to in section 188 (1) of the Act, are disclosed in Form AOC-2 as Annexure - C to this Report.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 DURING THE YEAR ALONG WITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR

There was no application made and proceeding initiated / pending under the Insolvency and Bankruptcy Code, 2016, by any Financial and/or Operational Creditors against your Company during the year under review. As on the date of this report, there is no application or proceeding pending against your Company under the Insolvency and Bankruptcy Code, 2016.

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

It is not applicable to the Company during the year under review, as there exist no Loans/Borrowing from any Bank, Financial Institution, etc. in any form or nature.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments, affecting the financial position of the Company which have occurred between the financial year of the Company to which the financial statements relate and the date of signing of this report.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS, COURTS AND TRIBUNALS

During the year under review, there are no significant and material orders passed by the regulators/courts or tribunals that could impact the going concern status and operations of the Company in future.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The provisions of the Corporate Social Responsibility as contained under section 135 of the Act are not applicable on the Company.

COMPANYS POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES

The Nomination and Remuneration Policy was developed by the Board of Directors of your Company in order to ensure compliance with Section 178 of the Act, as well as any other applicable laws. The Companys policy on Directors appointment and remuneration and other matters as provided in Section 178(3) of the Act is available on the website of the Company at and has been displayed on website www.bahetiindustries.com

ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OF INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Act and Listing Regulations the Board has carried out an annual evaluation of its own performance, the performance of the Directors individually as well as the evaluation of the working of its Committees.

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.

PROHIBITION OF INSIDER TRADING

In terms of the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended ("SEBI PIT Regulations"), the Company has adopted the revised "Code of Conduct to Regulate, Monitor and Report Trading by Insiders" ("the Code"). The Code is applicable to promoters, all directors, designated persons and connected persons and their immediate relatives, who are expected to have access to unpublished price sensitive information relating to the Company. The Company has also formulated a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI) in compliance with the PIT Regulations.

RISK MANAGEMENT

The process of identifying, evaluating, and prioritizing risks is known as risk management. This is preceded by coherent initiatives aimed at minimizing, oversee, and ameliorate (or control) the probability and/or impact of unfortunate events or to maximize opportunities for achievement. The Company has established a thorough risk assessment and minimization process, which is periodically reviewed by the Board. These processes are examined to make sure executive management effectively manages risk using a strictly delineated framework. The company has identified the major risks, and processes and measures for mitigating those risks have been developed in areas like business, project execution, events, financial, human, environmental, and statutory compliance.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company has always believed in providing a safe and harassment free workplace for every women employee working with your Company. Your Company always endeavors to create and provide an environment that is free from discrimination and harassment including sexual harassment.

Your Company has a zero tolerance for sexual harassment at workplace and, therefore, has in place a policy on prevention of sexual harassment at workplace. The said policy is in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. There was no complaint outstanding / received from any employee during the financial year 2022-23 and hence, no complaint is pending as on March 31, 2023 for redressal.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

In compliance with Section 177 of the Act and Regulation 22 of the Listing Regulations, your company has implemented a whistleblower policy and created the necessary vigil mechanism for directors and employees to enable the reporting of sincere concerns about improper or unethical behavior without fear of vengeance.

Your companys vigil mechanism offers sufficient protections against victimization of directors and employees who use it, as well as, in exceptional circumstances, direct access to the chairman of the audit committee. Access to the Chairman of the Audit Committee has never been denied to anyone. The aforementioned policy can be found on your companys website at www.bahetiindustries.com.

HEALTH, SAFETY AND ENVIRONMENT PROTECTION

Your Companys Health and Safety Policy commits to comply with applicable legal and other requirements connected with occupational Health, Safety and Environment matters and provide a healthy and safe work environment to all employees of the Company.

WEBSITE

In compliance with Regulation 46 of Listing Regulations, your company maintains a fully functional website with the domain name www.bahetiindustries.com. The website serves as a comprehensive source of basic information about our company.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule 8(3) of The Companies (Accounts) Rules, 2014, is attached as Annexure - A to this Report.

GREEN INITIATIVES

The Notice of the AGM and the Annual Report 2022-23 are being sent only electronically to Members whose email addresses are registered with the company or depositories in accordance with Regulation 36 of the Listing Regulations. Members may take note that the Notice and Annual Report for 2022-2023 will also be accessible at the website of the Company i.e. www.bahetiindustries.com.

CAUTIONARY STATEMENT

Statements in this Report, describing the Companys objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Forward looking statements are based on certain assumptions and expectations of future events. These statements are subject to certain risks and uncertainties. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The actual results may be different from those expressed or implied since the Companys operations are affected by many external and internal factors, which are beyond the control of the management. Hence the Company assumes no responsibility in respect of forward-looking statements that may be amended or modified in future on the basis of subsequent developments, information or events.

APPRECIATION AND ACKNOWLEDGEMENT

Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication, and commitment. The Board places on record its appreciation for the support and co-operation, your Company has been receiving from its suppliers, retailers, dealers and others associated with the Company. The Directors also take this opportunity to thank all its clients, vendors, banks, Government and Regulatory Authorities for their continued support.

For & on behalf of the Board of Directors Baheti Recycling Industries Limited

Date: September 6, 2023

Sd/-

sd/-

Place: Ahmedabad

Balkishan Shankerlal Shah

Yash Shankerbhai Shah

 

Managing Director

Joint Managing Director

 

DIN: 03006486

DIN: 09527701