Bedmutha Industries Ltd Directors Report.

To the Members

BEDMUTHA INDUSTRIES LIMITED

The Board of Directors presents the 31st Annual Report together with the Audited Financial Statements (Standalone and Consolidated) for the Financial Year ended March 31, 2021.

HIGHLIGHTS OF FINANCIAL PERFORMANCE:

The financial performance of the Company for the Financial Year ended on March 31, 2021 is summarized as under:

(Amount in Rs. Lakhs)

Particulars

Standalone

Consolidated

2020-21 2019-20 2020-21 2019-20
Income from Operations 38,808.46 35,978.14 38,835.02 36,079.68
Add : Other Income 31,087.54 2,730.81 31,099.22 2,727.67
Profit before Interest, Depreciation and Taxes 29,405.45 2,608.03 29,424.67 2,645.71
Less : Finance Cost 6,162.63 6,433.00 6,162.65 6,433.37
Profit/ (Loss) before Depreciation and Taxes 23,242.82 (3,824.97) 23,262.03 (3,787.66)
Less : Depreciation 3,572.59 3,308.50 3,573.89 3,314.74
Profit/ (Loss) Before Taxes 19,670.23 (7,133.46) 19,688.14 (7,102.40)
Less : Provision for Current Taxation - - 2.40 9.38
Less: Provision for Deferred Taxation - - (0.24) (1.32)
Less: Taxes in respect of earlier years 93.33 - 93.33 -
Profit/ (Loss) after Taxes 19,576.90 (7,133.46) 19,592.65 (7,110.46)
less: Minority Interest - - 1.64 9.58
add: Share in Profit/(Loss) of Associates - - 7.86 (0.85)
Profit/(Loss) for the year 19,576.90 (7,133.46) 19,598.87 (7,120.88)

SUMMARY OF OPERATIONS/STATE OF THE COMPANYS AFFAIRS:

During the financial year 2020-21, the Standalone, Income from operations of your Company increased by 7.87%, from Rs.359.78 Crores to Rs.388.08 Crores. The company has earned profit of Rs.294.05 crores before interest, depreciation and taxes and earned Profit of Rs.195.77 Crores after taxes as compared to previous year.

During the financial year 2020-21, the Consolidated, Income from operations of your Company increased by 7.64%, from Rs.360.80 Crores to Rs.388.35 Crores. The company has earned profit of Rs.294.25 crores before interest, depreciation and taxes and earned profit of Rs.195.99 Crores after taxes as compared to previous year.

The other income of Rs.31087.54 Lakhs includes Rs.28106.74 Lakhs on account of Interest Cost Reversal on account of Restructuring of Rs.12,133.96 Lakhs and initial gain on Recognition of CRPS at Fair value of Rs.15,972.78 and other income of Rs.2980.80 Lakhs against other income of Rs.2730.81 for the previous financial year.

FINANCIAL PERFORMANCE OF SUBSIDIARY, ASSOCIATE ENTITIES & JOINT VENTURES:

Further to the approval of the members of the Company at the Annual General Meeting held on 24th December, 2019, and pursuant to the restructuring plan, the Board of Directors disinvested the entire investment of 5,42,000 Equity Shares in the subsidiary on 22nd September, 2020, consequently, Kamalasha Infrastructure and Engineering Private Limited, ceased to be the Companys subsidiary.

CONSOLIDATED FINANCIAL STATEMENTS:

In accordance with the Companies Act, 2013 ("the Act") and IND AS 23 on Consolidated Financial Statements read with IND AS 28 on Investment in Associates and Joint Ventures, the audited consolidated financial statement is provided in the Annual Report. The summarized consolidated results are given alongside the financial results of your Company.

AMOUNT CARRIED FORWARD TO RESERVES:

Your Company has not transferred any amount to its reserves.

DIVIDEND:

Your Directors do not recommend any dividend for the financial year 2020-21.

BUSINESS REVIEW:

The outbreak of COVID-19 pandemic has led to an unprecedented health crisis and has disrupted economic activities and global trade, while weighing on consumer sentiments.

During the year under review, the Government of India had imposed stringent nationwide lockdowns, in phases, which severely impacted manufacturing activities. Though the Steel sectors were allowed to operate under the Essential Services Maintenance Act, 1968 they were subject to certain guidelines. Steel demand was affected as key steel consuming sectors struggled to operate amidst weakening economic activities, working capital constraints, shortage of manpower, and logistical issues.

There was impact of COVID-19 on the Companys operations, cash flow, liquidity and profitability as well as the Companys contribution to the community in wake of the pandemic.

As conveyed in the last Annual General Meeting regarding progress of implementation of Restructuring Plan and further to the approval of members of the Company at the Annual General meeting held on 14th December, 2020, that the Restructuring Plan has been successfully implemented on January 16, 2021. It has created positive impact on the financials of the Company for the Financial Year 2020-21 due to following features of the Restructuring Plan:

a) Rs.42.50 crores has been invested by the Investors and Promoters into the Company as on January 16, 2021 at total price of Rs.55/- per share including premium of Rs.45/- and Rs.10/- face value.

b) Consortium Banks have converted unsustainable loan of Rs.230.15 crores into Non-Convertible Cumulative Redeemable Preference Shares (CRPS) with coupon rate of 1.00% w.e.f. 01/01/2018. Hence, bank loan on the Company reduced by Rs.230.15 crores w.e.f. 01/01/2018

c) The Banks have also reduced the interest rate on sustainable loan from 12% pa to 9.05% pa w.e.f. 01/01/2018.

In line with the requirements of the restructuring, the Board of Directors has approved and completed the following Preferential Issues of Equity & Preference Shares of the Company, through their Fund Raising Committee at their meeting held on 16th January, 2021:

• Allotted 68,23,182 Equity Shares of Rs.10/- each for cash @ Rs.55/ per Equity Share (including a premium of Rs.45/- per Equity Share) aggregating to Rs.37,52,75,010/- to 3 Corporates belonging to Non-Promoter category;

59.09.091 Equity Shares to K-FX Services Private Limited;

9.09.091 Equity Shares to Aakash Universal Limited; and

5,000 Equity Shares to Aakaash Buildmate Construction Private Limited

• Allotted 9,09,091 Equity Shares of Rs.10/- each for cash @ Rs.55/- per Equity Share (including a premium of Rs.45/- per Equity Share) aggregating to Rs.5,00,00,005/- to K.R. Bedmutha Techno Associates Private Limited, Promoter Group category; and

• Allotted 23,01,500, in aggregate, 1.00% Non-Convertible Cumulative Redeemable Preference Shares ("CRPS") having a face value of Rs.10/- each, at Rs.1000/-, aggregating to Rs.230,15,00,000/-, to Punjab National Bank, Bank of Baroda, Bank of India, Exim Bank and Andhra Bank (now Union Bank), as per the Loan Restructuring scheme.

CHANGES IN THE NATURE OF BUSINESS:

There has been no change(s) of business of the Company or in the nature of business carried on by the Company during the financial year under review.

SHARE CAPITAL:

During the year under review, the Company had allotted (a) 77,32,273 Equity shares by way of Preferential Allotment, and due to which the paid up Equity share capital of the Company has been increased from Rs.24,53,16,110/- to 32,26,38,840/- of face value of Rs10/- each and (b)23,01,500, 1.00% Non- Convertible Cumulative Redeemable Preference Shares (CRPS) of face value of Rs.10/- each.

During the current financial year the Company has increased the Authorized Share Capital of the Company from Rs.30,00,00,000/- (Rupees Thirty Crores only) divided into 3,00,00,000 (Three Crores) Equity Shares of Rs.10/- (Rupees Ten only) to Rs.37,50,00,000/- (Rupees Thirty Seven Crores Fifty Lakhs only) divided into 3,50,00,000 (Three Crores Fifty Lakhs) Equity Shares of Rs.10/- (Rupees Ten only) each and 25,00,000 (Twenty Five Lakhs) Preference Shares of Rs.10/- (Rupees Ten only) each.

The Company has neither issued any shares with differential rights as to dividend, voting or otherwise nor issued any sweat equity shares during the year under review.

The Company has not granted any employee stock options. Further, it has not provided any money to its employees for purchase of its own shares hence the Company has nothing to report in respect of Rule 4(4), Rule 12(9) and Rule 16 of the Companies (Share Capital & Debentures) Rules, 2014.

The Company has not issued any Debentures/debt securities during the year under review.

As on March 31, 2021, none of the Directors of the Company hold instruments convertible into Equity Shares of the Company.

DEPOSITS:

During the year 2020-21, the Company has not accepted any deposit from public within the meaning of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

INDUSTRY SCENARIO:

National Steel Policy (NSP), 2017, aims to create crude steel capacity of 300 million tonnes (MT) and targets a robust finished steel per capita consumption of 158 kgs by 2030-31.

The construction sector, which includes both infrastructure and real estate, contributes about 62 per cent of the total steel demand. Both these sub-segments are witnessing demand revival which is expected to become stronger in 2021, especially as the government loosens its purse strings and spends more on infrastructure projects.

Policy for providing preference to Domestically Manufactured Iron and Steel Products (DMI & SP Policy) in Government Procurement

• This policy provides preference to Domestically Manufactured Iron and Steel Products (DMI & SP) in Government procurement. l The policy covers a list of 49 manufactured products of iron and steel.

• The minimum domestic value addition of 20-50 per cent is specified on these 49 products of iron and Steel. The Policy also covers capital goods for manufacturing iron and steel products for which minimum domestic value addition of 50 per cent is specified.

• No Global Tender Enquiry (GTE) shall be invited for tenders related to procurement of iron and steel products. No Global Tender Enquiry (GTE) shall be invited for tenders related to procurement of Capital Goods for manufacturing iron and steel products having estimated value upto Rs.200 Crore except with the approval of competent authority as designated by Department of Expenditure.

The policy has provisions for waivers to all such procurements, where specific grades of steel are not manufactured in the country, or the quantities as per the demand of the project cannot be met through domestic sources.

In the budget announced on February 1, 2021, Finance Minister announced revocation of anti-dumping duties and countervailing duties on stainless steel products and slashed custom duties on non-alloy steel products at 7.50% across all non-alloy products. While stainless steel industry may be adversely affected by this step, it might have little implications on non-alloy steel. Since, the imports of non-alloy steel takes place majorly nfrom nations with whom the country has signed free trade agreement and these imports enjoy zero import duty. However, the reduction in custom duties is likely to benefit the end users in MSME sector which were under stress due to rising prices of steel products.

The reduction of custom duties on scrap is expected to lower the prices of imported raw material which in turn is expected to marginally reduce production cost of steel for secondary steel players. The budget also unfurled number of infrastructure projects and increased the outlay on capital expenditure which are likely to strengthen the steel demand in the medium-term. The announcements such as capex augmentation in railways, metro rail projects, and vehicle scrappage policy are likely to benefit both primary and secondary steel producers. In medium term, domestic steel pipe manufacturers are likely to benefit from Jal Jeevan mission which has received allocation of Rs.2.87 lakh crore and from proposed extension of city gas distribution.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34(2)(e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is given in Annexure 1 forming part of the Annual Report.

PARTICULARS OF EMPLOYEES:

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the details of top ten employees, and none of the employees drawing the remuneration in excess of the limits set out in the said rules, are provided in Annexure 2 of this Boards Report.

The Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are also provided in Annexure 2 of the Boards Report.

MANAGERIAL REMUNERATION:

In accordance with Section 178 and other applicable provisions, if any, of the Companies Act, 2013 read with Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014 issued thereunder and Regulation 19 of the SEBI (LODR) Regulations, 2015, the Board of Directors at their meeting held on February 12, 2015 formulated the Nomination and Remuneration Policy of your Company on the recommendations of the Nomination and Remuneration Committee.

The salient aspects covered in the Nomination and Remuneration Policy, covering the policy on appointment and remuneration of Directors and other matters have been outlined in the Corporate Governance Report which forms part of this Report.

SUBSIDIARIES, JOINT VENTURE OR ASSOCIATES COMPANIES DURING THE YEAR:

Pursuant to restructuring, the Board of Directors disinvested the entire investment of 5,42,000 Equity Shares in the subsidiary on 22nd September, 2020, consequently, Kamalasha Infrastructure and Engineering Private Limited, ceased to be the Companys subsidiary, According, consolidation of accounts has been done only an accounts of Associate Company.

The company has one associate company named as "Ashoka Pre-con Pvt. Ltd."

The Statement in form AOC-1 containing salient features of the financial statements of Companys Subsidiaries and associates is attached as Annexure 3 to the financial statements of the Company.

In accordance with third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company. Further, as per fourth proviso of the said section, audited annual accounts of each of the subsidiary company have also been placed on the website of the Company, www.bedmutha.com. Shareholders interested in obtaining a copy of the audited annual accounts of the subsidiary company may write to the Company Secretary at the Companys registered office address.

SIGNIFICANT AND MATERIAL ORDER PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

During the year under review, no order has been passed by the regulators or courts or tribunals against the Company or any Directors, Key Managerial Personnel of the Company.

PARTICULARS OF CONTRACTS OR ARRANGMENTS WITH RELATED PARTIES:

All contracts/ arrangements/ transactions entered by the Company during the financial year 2020-21 with related parties are in compliance with the applicable provisions of the Companies Act, 2013 Rules issued thereunder and Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the year under review, the Company had not entered into any materially significant related party transactions with Promoters, Directors, Key Managerial Personnel or other designated persons, which may have a potential conflict with the interest of the Company at large. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

All Related Party Transactions are placed before the Audit Committee and the Board of Directors for their approval.

The policy on Related Party Transactions as approved by the Board may be accessed on the Companys website (www.bedmutha.com).

The particulars of contracts or arrangements entered into by the Company with related parties are appended in Annexure 4 to the Boards Report.

CORPORATE GOVERNANCE:

The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Company has also implemented several best Corporate Governance practices as prevalent throughout the country. The Report on Corporate Governance as stipulated under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is presented in a separate section forming part of the Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is attached to the report on Corporate Governance.

BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL:

As on March 31, 2021, the Company has 6 (Six) Directors consisting of 4 (Four) Independent Directors, and 2 (Two) Executive Directors.

Mr. Ajay Kachardas Vedmutha (DIN: 01726879), Managing Director of the Company, retires by rotation at the ensuing Annual General Meeting pursuant to the provisions of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and the Articles of Association of the Company and being eligible, offered himself for re-appointment. Your Directors recommend his re-appointment.

The Shareholders of the Company at the 30th Annual General Meeting has approved the appointment of Mr. Shreekrishna Marathe (DIN:08691908) as an Independent Director of the Company for a period of 5 (Five) consecutive years, not liable to retire by rotation i.e., till March 31,2025

On the basis of the recommendation of the Nomination and Remuneration Committee and the Board of Directors, members accorded their approval at the 29thAnnual General Meeting of the Company for continuation of appointment of Mr. Vasant Joshi, (DIN. 07348931) who has attained the age of 80 years.

The Shareholders of the Company at the 30th Annual General Meeting has approved the appointment of Mr. Vasant Joshi, (DIN 07348931), as an Independent Director for the (2nd) second term on the Board of Directors of the Company with effect from 26th November, 2020 till 25th November, 2025.

The brief resume of the Director(s) seeking appointment or re-appointment and other related information under Regulation 36 of the SEBI (LODR) Regulations, 2015 and Secretarial Standard-2 (SS-2) has been provided in the Notice convening 31st Annual General Meeting.

Presently, Mr. Vijay Vedmutha -Chairman and Managing Director, Mr. Ajay Vedmutha-Managing Director and Chief Financial Officer, Mrs. Vinita Ajay Vedmutha - Chief Executive Officer and Mr. Ajay Topale - Company Secretary are the Key Managerial Personnel of your Company in accordance with the provisions of Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

DECLARATION BY INDEPENDENT DIRECTORS:

The Independent Directors of the company are not associated with the Company in any manner as stipulated under section 149(6) of Companies Act, 2013 and at the same time possess relevant expertise and experience that are additive to the Board of the company for delivering higher growth and higher values. Further, the Company has received declarations from all the Independent Directors confirming that they meet the criteria of Independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (LODR) Regulations, 2015.

ANNUAL EVALUATION OF BOARDS PERFORMANCE:

According to Regulations 25(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a meeting of the Independent Directors is required to be held to evaluate the performance of the Non-Independent Directors. Accordingly, a meeting of Independent Directors was held on February 11,2021 wherein the performance of the Non-Independent Directors, including the Chairman, was evaluated.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 25(4) of SEBI (Listing Obligations and Disclosure Requirements) 2015, the Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of the members of Audit, Nomination and Remuneration and other Compliance Committees. The manner, in which the evaluation is carried out, has been explained in the Corporate Governance Report.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS:

Every new Independent Director of the Board attends an orientation program. To familiarize the new Independent Director with the strategy, operations and functions of our Company, the Executive Directors/ Senior Managerial Personnel make presentations to the new Independent Director about the companys strategy, operations, product and service and offerings, markets, organization structure, human resources, technology quality, facilities and risk management.

NUMBER OF BOARD MEETINGS:

The meeting of the Board of Directors was held 4 (Four) times as prescribed unde section 173 of the Companies Act, 2013 during the Financial Year 2020-21 and the intervening gap between two succeeding meetings was more than 120 days pursuant to relaxation provided by Circular no. 11/2020 dated March 24, 2020 in view of Covid 19 outbreak. Your Company has complied with the provisions of Chapter XII - Meetings of Board and its Powers, of the Companies Act, 2013 with respect to meetings of the Board. The details regarding the Board meetings and the attendance of the Directors present in such meetings are provided in the Corporate Governance report.

COMMITTEES OF THE COMPANY:

Audit Committee:

The Board has properly constituted the Audit Committee in compliance with Section 177 of Companies Act, 2013 and Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which consists of the following members viz.:

Name of Member Designation Category
Mr. Narayan Kadu Chairman Independent Director
Mrs. Vandana Sonwaney Member Independent Director
Mr. Vijay Vedmutha Member Executive Director (Chairman & Managing Director)
Mr. Vasant B. Joshi Member Independent Director
Mr. Shreekrishna Marathe Member Independent Director*

*Mr. Shreekrishna Marathe (DIN: 08691908) has been appointed as Additional Director (Non-Executive & Independent) w.e.f. April 01,2020 and has been appointed as Member of Audit Committee w.e.f. June 26, 2020.

The details regarding Composition, meetings and attendance of the members have been mentioned in the Corporate Governance Report.

All the recommendations of the Audit Committee during the year were accepted by the Board of Directors of the Company.

Establishment of Vigil Mechanism/Whistle Blower Policy:

The Company has established a vigil mechanism and oversees through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns about unethical practice. Any complainant can have direct access to the Chairman of the Audit Committee via e-mail ID. The Vigil Mechanism Policy of the Company is placed on Companys website i.e., http://www.bedmutha.com.

Nomination and Remuneration Committee:

The Board of Directors has constituted the Nomination and Remuneration Committee in accordance with the Companies Act, 2013 and Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which comprises of the following members viz.:

Name of Member Designation Category
Mr. Narayan Kadu Chairman Independent Director
Mrs. Vandana Sonwaney Member Independent Director
Mr. Vasant B. Joshi Member Independent Director
Mr. Shreekrishna Marathe Member Independent Director *

*Mr. Shreekrishna Marathe (DIN: 08691908) has been appointed as Additional Director (Non-Executive & Independent) w.e.f. April 01,2020 and has been appointed as Member of Nomination & Remuneration Committee w.e.f. November 11, 2020.

The details regarding composition, meeting and attendance of the members have been mentioned to the Corporate Governance Report.

Policy for Selection, Appointment and Remuneration of Directors Including Criteria for Their Performance Evaluation

The Company has adopted a policy titled as "Nomination & Remuneration Policy" which inter alia includes Companys policy on Board Diversity, selection, appointment and remuneration of directors, criteria for determining qualifications, positive attributes, independence of a director and criteria for performance evaluation of the Directors.

The Nomination & Remuneration Policy as approved by the Board is placed on the website of the Company. (www.bedmutha.com)

Stakeholder Relationship Committee:

The Board of Directors has constituted Stakeholders Relationship Committee in accordance of the Companies Act, 2013 and Regulation 20 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details regarding Composition, meeting and attendance of the members have been mentioned to the Corporate Governance Report.

Corporate Social Responsibility Committee (CSR):

As per Section 135 of the Companies Act, 2013, every Company having net worth of Rupees five hundred crore or more, or turnover of Rupees one thousand crore or more, or a net profit of Rupees five crore or more during the immediatly preceding financial year shall constitute the CSR Committee.

Considering the above threshold limit specified above, the Company is not required to constitute the CSR Committee.

RISK MANAGEMENT POLICY:

The Company has implemented Risk Management Policy and the Board of Directors has prepared a comprehensive framework of risk management for assessment of risks and to determine the responses to these risks so as to minimize their adverse impact on the organization. The policy as approved by the Board of Directors is uploaded on the Companys website. (www.bedmutha.com)

The Company manages, monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives. The Companys management systems, organizational structures, processes, standards, code of conduct and behaviors together form the Bedmutha Management System (BMS) that governs how the Group conducts the business of the Company and manages associated risks.

The Company has introduced several improvements to drive a common integrated view of risks, optimal risk mitigation responses and efficient management of internal control and assurance activities. This integration is enabled by all three being fully aligned in the Company wide Risk Management, Internal Control and Internal Audit methodologies and processes.

Risk & Mitigation:

The Company has identified various risks faced by the Company from different areas. As required under Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has adopted a risk management policy whereby a proper framework is set up.

Appropriate structures are present so that risks are inherently monitored and controlled. A combination of policies and procedures attempts to counter risk as and when they evolve.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Your Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed. Your Company has introduced several improvements such as Integrated Enterprise Risk Management, Internal Control Management and Assurance Frameworks and processes to drive a common integrated view of risks, optimal risk mitigation responses and efficient management of internal control and internal audit activities. Risk management and internal control frameworks are designed and implemented to manage rather than completely eliminated the risk of failure to achieve business objectives.

The Company has appointed M/s. Swati Ware & Co., Chartered Accountant as an internal Auditor to have check on the adequacy of controls in the overall operations and functioning of various departments. The monthly reports of the Internal Auditors are placed before the Audit committee. It is a key component which assists the management in discovering controls, weakness, regulatory violations, policy violation and operational inefficiencies. This self-discovery of issues provides the management an ability to take corrective action in order to maintain the safety, soundness, profitability and integrity.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS HELD BY THE COMPANY UNDER SECTION 186 WITH DETAILS:

The loans, guarantees and investments covered under section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF FINANCIAL YEAR AND DATE OF REPORT:

There are no material changes and commitments made which may affect financial position of the Company between the end of financial year and date of report.

STATUTORY AUDITORS:

Mr. A. D. Kulkarni (ICAI Membership No.: 049739), Proprietor of M/s. A. D. Kulkarni & Co., Chartered Accountants, Jalgaon (Firm Registration No. 115959) were appointed as Statutory Auditors of the Company at the Annual General Meeting held on September 25, 2017, for a period of five (5) consecutive years commencing from the conclusion of 27th AGM till the conclusion of the 32nd AGM of the Company.

In terms of the provisions relating to statutory auditors forming part of the Companies Amendment Act, 2017, notified on May 7, 2018, ratification of appointment of Statutory Auditors at every AGM is no more a legal requirement. Accordingly, the Notice convening the ensuing AGM does not carry any resolution on ratification of appointment of Statutory Auditors.

AUDITORS REPORT:

During the year under review, there were no frauds reported by the Auditors to the Audit Committee or the Board under Section 143(12) of the Companies Act, 2013.

There are no qualifications, reservations, disclaimer or adverse remarks in the Auditors Report.

INTERNAL AUDITORS:

M/s. Swati Ware & Co., Chartered Accountants, is the Internal Auditors of the Company and their reports are reviewed by the Audit Committee on periodical basis.

COST AUDITORS:

In accordance with the provisions of Section 148 of Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, your Company has to appoint cost auditors for conducting the audit of cost records of the applicable products of the Company for the financial year. Accordingly, during the year, your Company has appointed M/s. Deodhar Joshi & Associates, Cost Accountants (Firm Registration No.: 002146) to conduct the cost audit of the Company for the Financial Year 2020-21. The ratification of the remuneration payable to the Cost Auditors shall be sought from shareholders in the ensuing Annual General Meeting.

COST RECORDS

The Company is maintaining the Cost Records as specified by the Central Government under Section 148(1) of the Companies Act, 2013.

SECRETARIAL AUDITORS:

In terms of Section 204 of the Companies Act, 2013 and the Rules made there under, M/s. S. Anantha & Ved LLP (LLPIN: AAH-8229) had been appointed as the Secretarial Auditors of the Company for the financial year 2020-21.

The Secretarial Audit Report for the year under review is annexed as "Annexure 5" to this report.

Necessary explanation to the observation made in the Secretarial Audit Report is given below:

The Company has availed benefit of immunity offered by MCA under CFSS and extension granted by MCA for filing e-forms after due date without payment of additional fees, considering COVID-19 Pandemic situation.

Management Reply:

The Board has advised the Secretarial Department to file the E-forms within due date to avoid such delay in future. Also due to Covid 19 pandemic, the Company has availed benefit of immunity offered by MCA under CFSS for filing of few forms.

ANNUAL RETURN:

The Annual Return of the Company in prescribed form MGT-7 is available on the website of the Company at www.bedmutha.com.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors of your Company hereby state that:

(i) In the preparation of the Annual accounts for the year ended March 31,2021, the applicable accounting standards have been followed along with proper explanation related to material departure(s), if any;

(ii) The Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31,2021 and of the profit of the Company for the year ended on that date;

(iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) The Directors have prepared the annual accounts on a ‘going concern basis;

(v) The Directors of the Company have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively; and

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

HUMAN RESOURCES:

Your Company enjoys cordial relations with its employees. The key focus of your Company is to attract, retain and develop talent. The Board wishes to place on the record its appreciation of the contributions made by all employees ensuring high levels of performance and growth during the year.

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

The information on conservation of Energy, Technology Absorption and Foreign Exchange Earnings and outgo mentioned under Section 134(3)(m) read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is annexed as Annexure 6 to this report.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND:

Your Company did not have any funds, being dividends 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).

POLICY ON PREVENTION OF SEXUAL HARASSMENT:

The Company has in place Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition &Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year 2020-21, no complaints were received regarding sexual harassment. Further, the Company is conducting the awareness programs at regular interval of time.

OTHER MATERIAL INFORMATION:

During the year under review, there is no other material information to report.

SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA (ICSI):

The Company complies with the Secretarial Standards issued by ICSI, one of the premier professional bodies in India. CAUTIONARY STATEMENT:

Statement in the Directors report and the Management Discussion and Analysis describing the companys objectives, expectations or predictions, may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in statement. Important factors that could influence the company operation include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical material and their cost, changes in government policies and tax laws, economic developments of the country and other factors which are material to the business operations of the company.

ACKNOWLEDGEMENT:

Your Directors wish to thank and acknowledge the contributions of Financial Institutions, Banks, Government Authorities, dealers, suppliers, business associates, auditors, consultants and the Companys valued customers for their assistance and co-operation and the esteemed shareholders for their continued trust and support. The Directors also wish to acknowledge members of Bedmutha Group at all levels for their spirit of commitment, dedication and support extended in challenging times.

For and on behalf of Board of Directors
BEDMUTHA INDUSTRIES LIMITED
Vijay Vedmutha
Chairman & Managing Director
DIN:00716056
Date: August 17, 2021
Place: Sinnar