Bodal Chemicals Ltd Directors Report.

To

The Members of Bodal Chemicals Ltd.,

The Directors hereby present their "34th ANNUAL REPORT" on the performance of the Company together with the audited financial statements for the financial year ("FY") ended 31st March, 2020

Financial Results

Financial Results of the Company for the year under review along with figures of the previous year are as follows:

(Rs. in Million)
Year Ended Standalone Consolidated
Year Ended 31st March, 2020 Year Ended 31st March, 2019 Growth % Year Ended 31st March, 2020 Year Ended 31st March, 2019 Growth %
Total Revenue 12,318 13,940 (11.64) 13,852 14,369 (3.60)
Earnings before Interest, 1,580 2,477 (36.21) 1,481 2,495 (40.64)
Depreciation and Tax (EBIDTA)
Profit after Tax 1,022 1,441 (29.08) 867 1,413 (38.64)
Total comprehensive income 1,037 1,436 (27.79) 864 1,409 (38.68)
Earnings Per Share (EPS) (Basic) 8.35 11.78 (29.12) 7.16 11.56 (38.08)

Note: previous years figures have been recast wherever necessary.

IMPACT OF THE COVID-19 ON BUSINESS OF THE COMPANY

The operations of the Company were affected due to the lockdown announced by the Government of India to control the spread of Corona virus. The Companys manufacturing operations have been partially functional since 11th May, 2020 with the permissions of the State Government, well with the functioning guidelines issued by Ministry of Home Affaire (MHA). The Company has adhered to the guidelines as specified by the Government of India and complying with all safety measures to safeguard its employees from COVID-19 disease. The Company has formulated policy for work from home for all employees except employees associated with manufacturing activity. Plant operations have been partially functional throughout the lockdown period initially with residual staff, all housed within our premises.

THE FINANCIAL YEAR UNDER REVIEW 2019-2020

PERFORMANCE DISCUSSSION

The Financial Year 2019-20 is a year where your company has sustained well and as a group performed satisfactory. Though the challenges related to the reduction in prices of finished goods and lesser demand etc. were there but your company has done well and that have been reflected in the top line and bottom line for current financial year. Your company has achieved productivity gains, volume growth and sustainable margins. During the year under review, group has achieved Total Revenue of Rs. 13,852 Million and revenue has declined 3.60% compared to previous year. During the year under review EBIDTA and Profit after Tax of the Group were stand lesser by 40.64% and 38.64% respectively compared to earlier year.

Bodal Chemicals Ltd. (BCL)

Bodal Chemicals Ltd. is the most integrated Dyestuffs Company in India and also the biggest manufacturer of Dye Intermediates in India. The Companys product range covers Dyestuffs, Dye Intermediates and Basic Chemicals broadly classified under Specialty Chemicals. It has a unique and integrated product line covering forward and backward integration to dye intermediates. It contributes about 20% of Indias capacity and about 5% of the worlds capacity for Dye Intermediates. Out of the total production, about 41% is exported to over 45 countries across the world.

The Company is listed on BSE Ltd. (Bombay Stock Exchange) and National Stock Exchange of India Ltd. (NSE).

The broad areas of operations of the Company are as under:

Dyes

Your Company is a leading manufacturer of Reactive, Acid and Direct Dyes. Bodal Chemicals has capacity of manufacturing more than 150 variants of Dyestuff which are principally used as raw materials in Textiles, Leather, Paper & other Dyestuff consuming industries

Dye Intermediates

Bodal is the largest manufacturer of Dye Intermediates in India and among the leading manufacturers of Dye Intermediates in the world. Bodal Chemicals has capacity of manufacturing up to 25 Dyes Intermediates products. These Dye Intermediates are directly sold as well as consumed captively for manufacturing different kinds of Dyes.

Other/Basic Chemicals

Bodal is also a manufacturer of other Chemicals like Sulphuric Acid, CSA, Oleums, Beta Napthol and Acetanilide. These Chemicals are used as key raw materials for production of Dye Intermediates, which is highly beneficial in terms of improving profitability of the Company.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES:

- Subsidiaries:

1. SPS Processors Private Ltd.- Subsidiary Company

2. Trion Chemicals Private Ltd.- Wholly Owned Subsidiary Company

3. Bodal Chemicals Trading Pvt Ltd- Wholly Owned Subsidiary Company

4. Bodal Chemicals Trading (Shijiazhuang) Co., Ltd.- Wholly Owned Subsidiary Company

5. SENER BOYA KIMYA TEKSTIL SANAYI VE TICARETANONIM SIRKETI-Subsidiary Company

6. Bodal Bangla Ltd.- Wholly Owned Subsidiary Company

- Step-down subsidiaries:

1. SENPA DIS TICARET ANONIM SIRKETI

S P S PROCESSORS PVT. LTD. (SPS)

S P S Processors Pvt. Ltd. is a company engaged in manufacturing of dye intermediates.

Your Company is holding 70% equity stake in S P S Processors Pvt. Ltd, a subsidiary company of Bodal Chemicals Ltd.

SPS has a manufacturing plant located at Kosi, Uttar Pradesh, India having running operational capacity to produce 3,000 tons per annum (TPA) of H-Acid, a key Dye Intermediate. The manufacturing plant is a "zero discharge" unit and only about four and half year old. S P S Processors Pvt. Ltd. also has all necessary permissions to manufacture Vinyl Sulphone another key Dye Intermediate, as well as Dyestuff, at the same plant. With the available permissions, the Company is building a 6000 TPA Vinyl Sulphone plant. The project is expected to start and stabilise production during 2020-21.

This investment will help the Company to increase its manufacturing capacity of Dye Intermediates and consolidate its position in the local and global markets of Dye Intermediates and Dyestuff.

Further Financial Results of the Company for 2019-20 is available on website of the Company at www.Bodal.com

TRION CHEMICALS PVT. LTD. (TCPL)

During the current financial 2019-20, your Company has made further investment in TCPL of Rs. 58.71 Million during the month of March 2020 and after the said acquisition the stake of Bodal Chemicals Ltd in TCPL is 100% and TCPL has become a Wholly Owned Subsidiary company of Bodal Chemicals Ltd.

TCPL had commissioned a plant to manufacture

Trichloroisocyanuric Acid (TCCA), falling under specialty chemicals, at Neja, Near Khambhat, Gujarat. TCCA is a disinfectant - an algaecide and bactericide used mainly by swimming pools and water treatment plants. It is also used as a bleaching agent by the textiles industry.

TCPLs TCCA plant is the first plant of this specialty chemical in India. TCPLs business plan is focused on the US market. Company is targeting mainly USA market. It has already secured EPA licence in USA for environment protection.

Further Financial Results of the Company for 2019-20 is available on website of the Company at www.Bodal.com Further, After Completion of Financial year, Board of Directors of Trion Chemicals Pvt Ltd and Board of Directors of Bodal Chemicals Ltd at their meeting Held on 26th May 2020 and 27th May, 2020 respectively, Considered and approved Amalgamation of Trion Chemicals Pvt Ltd (Transferor Company), a Wholly Owned Subsidiary of the Company with Bodal Chemicals Ltd (Transferee Company).

Bodal Chemicals Trading Pvt Ltd

Bodal Chemicals Trading Pvt Ltd, a Wholly Owned Subsidiary Company was incorporated in India on 07th December 2018. It was incorporated with object of trading in chemical products. The Company has Commenced commercial operations. It is not material subsidiary as per the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 Further Financial Results of the Company for 2019-20 is available on website of the Company at www.Bodal.com

Bodal Chemicals trading Shijiazhuang Ltd (China)

Bodal Chemicals trading Shijiazhuang Ltd,a Foreign Wholly Owned Subsidiary of the Company incorporated in China in 2018-19, for trading activities in Chemicals Product.

Apart from the trading activity within china,this company will become an important arm for bodal chemicals Ltd to distribute its final product i.e. dyestuffs in domestic market of China. This will also help sourcing of some raw materials from China to India. The Company has started commercial operations. It is not material subsidiary as per the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015

Further Financial Results of the Company for 2019-20 is available on website of the Company at www.Bodal.com

Sener Boya Kimya Tekstil Sanayi Ve Ticaretanonim Sirketi, Sener Boya Kimya Tekstil Sanayi Ve Ticaretanonim Sirketi a Foreign Subsidiary of the Company having acquired stake of 80%, for trading activities in Chemicals products at Turkey.

Apart from the trading activity within Turkey, this company will become an important arm for bodal chemicals Ltd to distribute its final product i.e. dyestuffs in domestic market of Turkey and reach out to other Local Areas. The Company has started commercial operations. It is not material subsidiary as per the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015.

Further Financial Results of the Company for 2019-20 is available on website of the Company at www.Bodal.com

Bodal Bangla Ltd

Bodal Bangla Ltd, a Foreign Wholly Owned Subsidiary of the Company incorporated 22th September, 2019 in Bangladesh, for trading activities in Chemicals Products. The Company has started Commercial Operations. Further It is not Material Subsidiary as per the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 Further, Financial Results of the Company is available on website of the Company at www.bodal.com

SENPA DIS TICARET ANONIM SIRKETI- Step Down Subsidiary company of the Company

SENPA DIS TICARET ANONIM SIRKETI is Wholly Owned Subsidiary, of SENER BOYA KIMYA TEKSTIL SANAYI VE TICARETANONIM SIRKETI which is subsidiary company of Bodal Chemicals Ltd, incorporated in 2018-19 in Turkey.

Pursuant to the provisions of Section 129, 134 and 136 of the Companies Act, 2013 read with rules framed there under and Regulation 33 of the SEBI Listing Regulations, the Company has prepared consolidated financial statements of the Company and its subsidiaries and a separate statement containing the salient features of financial statement of subsidiaries, joint ventures and associates in Form AOC-1 which forms part of this Annual Report. Further Company shall place separate audited accounts of the subsidiaries Company on the website of the Company at www. Bodal.com Pursuant to Section 134 of the Act read with Rule 8(1) of the Companies (Accounts) Rules, 2014 the details of developments of subsidiaries of the Company are covered in the Managements Discussion and Analysis Report which forms part of this Report.

Scheme of Amalgamation

During the year under review, your company has prepared the draft Scheme for amalgamation of Trion Chemicals Pvt. Ltd with Bodal Chemicals Ltd and for that purpose Registered Valuer was appointed to get Valuation Report in the month of March 2020 on the basis of the latest audited financial statements as on 31st March 2019, with appointed date 01st April, 2019. Relevant consultants were also appointed for the said work in March, 2020. Further, company has also planned Board meeting to considered scheme in month of March, 2020, however, due to wide spread of COVID-19 in India, Global Pandemic situation and starting of complete lock down throughout the country for a long time, during the month of March 2020, the Company was unable to complete the requisite formalities like passing the Board Resolutions, submission of the Scheme to the concerned Stock Exchanges and to file the proceedings with the Tribunal.

Later, Board of Directors of your company and also of TCPL-Wholly Owned Subsidiary of the Company at their Board meetings held on 27th May, 2020 and 26th May 2020 respectively, has considered and approved Draft Scheme of Amalgamation of Trion Chemicals Ltd-Wholly Owned Subsidiary with the Bodal Chemicals Ltd-Parent Company. Further, Company has made required disclosures in pursuant to applicable regulation of SEBI (LODR) to Stock Exchanges (BSE and NSE) and filling necessary forms and documents to RoC. Presently process is going on to implement Scheme of Amalgamation. The Appointed Date of Amalgamation is 01st April, 2019.

Rationale of the Scheme:

The Transferee Company is the sole shareholder in the Transferor Company holding 100% shares along with a nominee. It has been realised by the Board of Directors of both the companies that the amalgamation of both these companies shall be helpful to achieve the following objectives-

(a) The commercial activities of both the companies are of similar nature and amalgamation will result in business and operational synergies in terms of complete integration of facilitates which would result in optimum utilisation of capital and resources and reduction in overall operating and maintenance cost and benefits of economies of scale.

(b) simplify management structure, leading to better administration and a reduction in costs from more focused operational efforts, rationalisation, standardisation and simplification of business processes, and the elimination of duplication, and rationalization of administrative expenses;

(c) The amalgamation will result in reduction in the multiplicity of legal and regulatory compliances and reduced costs.

(d) Simplify shareholding structure and reduce shareholding tiers; In view of the aforesaid, the Board of Directors of both the companies have considered and proposed the amalgamation of the entire undertaking and business of the Transferor Company with the Transferee Company pursuant to the provisions of Sections 230 to 232 of the Act and other relevant provisions of the Act, and other Applicable Laws.

In Terms of the Scheme and Upon coming into effect of this Scheme, the Equity and Preference shares held by the Transferee Company in the Transferor Company shall stand automatically cancelled with effect from the Effective Date without any further application, act or deed and no consideration shall be issued against the same.

Further, full details of approved Scheme of amalgamation and related disclosures and updating/Status of Amalgamation is also placed on the website of the Company at www.bodal.com

CAPITAL STRUCTURE & LIQUIDITY Authorised Share Capital

During the 2019-2020, Company has reclassified its Authrorised Share capital between Equity shares and preference shares. Total authorized capital of the company is Rs. 52,00,00,000/- (Rupees Fifty-Two Crore Only) divided into 16,00,00,000 (Sixteen Crore only) Equity Shares of Rs. 2/- (Rupees Two) each and 2,00,00,000 (Two Crore only) Preference Shares of Rs. 10/- (Rupees Ten) each.

Issued and paid up Share Capital

The Issued, Subscribed & Paid-up Equity Share Capital of the Company as at 31st March 2020 was Rs. 244.66 Million divided into 122330165 Equity Shares, having face value of Rs. 2 each.

During the year under review, Company has allotted 1,41,400 equity Shares to the employees against the Option granted under Employee Stock Option Scheme i.e. ESOP-2017 and after that paid up share capital stood at Rs. 244.66 Million divided into 122330165 Equity Shares, having face value of Rs. 2 each.

Employees Stock Option (ESOP/ESOS)

Exercise of Options granted (Grant-01) under Bodal ESOP- 2017

During the year under review, The Nomination and Remuneration Committee at its meeting held on 21st May, 2019 has allotted 1,41,400 Number of Options granted (Grant-01) at an Exercise price of Rs. 50.00/- per share.

Grant of Options (Grant-02) under Bodal ESOP-2017

During the year under review, The Nomination and Remuneration Committee at its meeting held on 21st May, 2019 has further granted Options of 162900 to eligible employees in Second tranche under Bodal ESOP Scheme-2017 at an exercise price of Rs. 50.00/- per share. These Options is vested for 1 year and are exercisable within a period of One year from the date of grant upon satisfaction of Vesting Condition.

Grant of Options (Grant-03) under Bodal ESOP -2017

During the year under review, The Nomination and Remuneration Committee at its meeting held on 12.02.2020 has further granted options of 163900 to eligible employees in Third tranche under Bodal ESOP Scheme-2017 at an exercise price of Rs. 10.00/- per share. The Options shall vest after 1 year of Vesting Period and are exercisable within a period of One year from the date of grant upon satisfaction of Vesting Condition.

Details and Summery of Employee Stock Options granted/vested/exercised during the year 2019-20 are given in "Annexure 2" to this report.

Further Disclosures of the same for above events were filled to BSE and NSE and also placed on Companys website at www.bodal.com.

General Reserve

During the year under review, your Directors do not propose to transfer any amount to the General Reserve.

Term Loan and Working Capital

As on 31st March 2020, the total Debt was Rs. 2,383.31 Million, cash and Cash Equivalents were Rs. 122.64 Million resulting in Net Debt of Rs. 2,260.67 Million (Rs. 1,295.22 Million as on 31st March 2019) total Debt consisted of Rs. 2,383.31 Millions of working capital loans. Further, there are no long-term loans, including long term loans maturing within 12 months of the balance sheet date.

RATINGS

The credit rating for the Company for last two years are as below: -

Type of Credit Rating Ratings for 2018-19 Ratings for 2019-20
India Ratings CARE Rating India Ratings CRISIL Rating
Long Term IND A+ CRISIL IND A+ CRISIL A+
Bank A+
Facilities
Short IND A1+ CRISIL IND A1+ CRISIL
Term Bank A1+ A1+
Facilities

DIVIDEND

During the year 2019-20, the Board of Directors at their meeting held on 12th February 2020 has Considered and approved Interim Dividend of Rs. 0.80 (40% of Face Value of Rs. 2) per share which had absorbed Rs. 117.98 Million, including dividend distribution tax of Rs. 20.12 Million.

TRANSFER OF UNCLAIMED SHARES & DIVIDEND AMOUNT TO INVESTOR EDUCATION AND PROTECTION FUND

Section 124 of the Companies Act, 2013 mandates that companies shall transfer dividend that remain unclaimed for a period of seven years, from the unpaid dividend account to the Investor Education and Protection Fund (IEPF).

During the year under review, Your Company has not transferred any unclaimed amount and Shares to IEPF Authority.

Further, The Company has uploaded complete details of such Shares which were already transferred to DEMAT Account of IEPF Authority on its website: www.bodal.com. Furthermore, Shareholders may claim back the shares which were already credited along with the unclaimed dividend amount from IEPF Authority after following the procedures prescribed under IEPF Rules. The procedures for claiming the same is available at www.mca.gov.in and www.iepf.gov.in.

PUBLIC /FIXED DEPOSITS

During the year under review, The Company has not accepted any deposit during the financial year under review. There were no deposits remaining unpaid/ unclaimed as at the end of the financial year 2019-20 and as such no amount of principal or interest was outstanding, as on the date of the balance sheet.

LISTING OF SECURITIES

Bodal Chemicals has 122330165 Equity Shares of Rs. 2 each fully paid, listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). The Company confirms that it has paid annual listing fees for the financial year 2020-21 to both the Exchanges (BSE & NSE) where the Companys equity shares are listed.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors Appointment, Retirement and Resignation Bodal Chemicals has 7 (Seven) Directors including 3 (Three) Executives Director and 4 (Four) Independent Directors including a woman Director at the end of financial year 31st March 2020.

APPOINTMENT OF DIRECTORS

On the recommendation of Nomination and Remuneration Committee, Board of Directors has appointed Mr. Ram Parasad Srivastava (DIN: 02227457) as an Independent Director of the Company for the term of 5 years (1st Term) w.e.f. 13th August, 2019 and subsequently approved by Members of the Company by way of passing special resolution at Annual General Meeting held on 20th September, 2019.

On the recommendation of the Nomination and Remuneration Committee, Board has re-appointed Mr. Suresh J Patel (DIN: 00007400) as Chairman and Managing Director for a period of 3(Three) years with effect from 13th May, 2020. His appointment is subject to approval of Members of the Company and your approval has been sought for the same in the Notice Convening the forthcoming AGM of the Company.

On the recommendation of the Nomination and Remuneration Committee, Board has appointed Mr. Rajarshi Ghosh (DIN: 08715159) as Director-HSE for a period of 5(Five) years with effect from 27th May, 2020. His appointment is subject to approval of Members of the Company and your approval has been sought for the same in the notice convening forthcoming Annual General meeting of the Company.

Mr. Ankit S Patel, Executive Director, retire by rotation at the ensuring Annual General Meeting. He, being eligible, offers himself for re-appointment. None of the Directors of the Company are disqualified from being appointed as Directors as specified under Section 164 of the Companies Act, 2013.

Details of all the Directors have been covered in the Corporate Governance Report which forms a part of the Annual Report.

For the perusal of Shareholders, a brief resume of all the above Directors, nature of their expertise, their shareholding in the Company and other required details are given in the section of the Corporate Governance Report, which forms a part of the Directors Report in the Annual Report.

RESIGNATION OF DIRECTOR

During the year under review, Dr. Parin D. Shah. (having DIN: 08313035), Independent Director of the company, resigned from the post of Director (Independent) of the Company with effect from 05th July 2019 and the Board of Directors took note of the same at the Board Meeting held on 12th July, 2019. The Board of Directors places on record their appreciation of the valuable guidance and contribution made by Dr. Parin D. Shah during his tenure as Independent Director of the Company.

Further, Dr. Parin D. Shah. (DIN: 08313035), Independent Director resigned as Independent Director and member/ chairman from all committees due to coming across the opportunity(job) in government sector and as per terms and Conditions related to service of Government he is restricted to continue as independent Director or associate with any organisation/Companies (either in Executive or Non-Executive basis). Further, Dr. Parin D. Shah has provided confirmation that there are no such material reasons other than those provided in his resignation letter.

During the year under review, Mr. Kishorkumar P Radadia (DIN: 08532580) resigned from the post of Director-HSE of the Company w.e.f. 29th February, 2020 and the Board of Directors took note of the same at the Board Meeting held on 12th February, 2020.

Further, Mr. Kishorkumar P Radadia (DIN: 08532580) Director-HSE resigned as Director-HSE of the Company due to his health issue. Further Mr. Kishorkumar P Radadia has provided confirmation that there are no such material reasons other than those provided in his resignation letter.

KEY MANAGERIAL PERSONNEL

Followings are the Key managerial personal of the company as on date of this report

- Mr. Suresh J Patel, Chairman and Managing Director (DIN: 00007400)

- Mr. Bhavin S Patel,Executive Director (DIN:0030464)

- Mr. Ankit S Patel, Executive Director (DIN: 02173231)

- Mr. Mayur B Padhya, Chief Financial Officer

- Mr. Ashutosh B Bhatt, Company Secretary

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declaration from all Independent Directors that they meet the Criteria of Independence as laid down in Section 149 (6) of the Companies Act, 2013 and regulations 27 (2) of the SEBI (LODR) regulations, 2015 (Listing regulations). There were no pecuniary transactions entered into with the Independent Directors apart from sitting fees.

REMUNERATION OF DIRECTORS AND KMP

Pursuant to the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014, disclosures pertaining to remuneration of Managerial employees, a Statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is attached as Annexure 3 which forms part of this Report.

Company received Confirmation form Chairman of NRC Committee of the Company that Appointment term and Remuneration decide by the NRC Committee based on NRC Policy of the Company.

REMUNERATION POLICY

The Company has in place a Remuneration Policy for the Directors, KMP and other employees pursuant to the provisions of the Act and the Listing Regulations which is explained in Corporate Governance Report and which forms a part of the Boards Report.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The Company has an ongoing Programme where Directors in the course of meetings of the Board of Directors give information about Chemical Business developments, Expansion of the Company and various amendments in legal and regulatory areas which include mandatory disclosures and fair disclosures stated under SEBI (LODR) regulations, 2015 (herein referred to as "Listing Agreement"), Prohibition & Insider trading regulations, and SAST Regulations so as to enable them to effectively discharge their roles, rights and responsibilities in the Company.

Details of the Familiarisation Programme for Independent Directors are available on the website of the Company at www.bodal.com

DIVERSITY OF THE BOARD

The Company recognises and embraces the benefit of having a diverse Board of Directors and views increasing diversity at the Board level as an essential element in maintaining competitive advantage in the Business in which it operates. This Policy can be accessed from the Companys website-www.bodal.com and its weblink https://bodal.com/live.php?data=6_l2

BOARD MEETINGS

During the year under review, 5(Five) meetings of the Board of Directors were held. Details of the Composition of the Board and its committees and meetings held and attendance of the Directors at such Meetings and other relevant details are provided in the Corporate Governance Report.

Further, During the year, Company has passed Board Members and NRC Committee Resolutions through Circulation dated 09th October, 2019.

MEETING OF INDEPENDENT DIRECTORS

The Independent Directors of the Company met separately on 12th February, 2020 without the presence of Non-Independent Directors and the members of management. In accordance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligation and Disclosure Requirement) Regulation, 2015, the following matters were, inter-alia discussed in the meeting:? Review the performance of Non-Independent Directors and the Board as a whole? Review the performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-executive Director Assess the quality, quantity and timelines of flow of information between the Company management and the Board that is necessary for the Board Members to effectively and reasonably perform their duties

BOARDS ANNUAL EVALUATION

In terms of the requirements of the Companies Act, 2013, and the Listing Regulations, the Board carried out the annual performance evaluation of the Board as a whole, Board Committees and the Directors The Evaluation framework adopted by the Board is set out in the Corporate Governance Report.

AUDITORS

STATUTORY AUDITORS

Your Directors recommend, as identified and suggested by the Audit Committee of the Company to continue with M/s Deloitte Haskins & Sells LLP, (FRN No. 117366W/W-100018) as statutory Auditor of the Company for 2020-2021 and 2021-2022, subject to approval of the Members of the Company, to hold office from the conclusion of the Thirty Four (34th) Annual General Meeting until the conclusion of the Thirty Sixth (36th ) Annual General Meeting of the Company.

The Company has received a certificate from the Auditors stating that their appointment, if made, will be within the limit specified under Sections 139 and 141 of the Companies Act, 2013.

The report of the Statutory Auditors along with Notes to Schedules is enclosed with this Report. The Auditors Comments on the Companys Accounts for the financial year ended on 31st March, 2020 are self-explanatory in nature and do not require any explanation as per provisions of Section 134 of the Companies Act, 2013. The Auditors Report does not contain any qualification, reservation or adverse remark.

INTERNAL AUDITORS

M/s. Rashmin R. Patel & Co., Chartered Accountants (FRN: 132265W), Ahmedabad are Internal Auditors of the Company. 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 quarterly basis. The scope of internal audit is approved by the Audit Committee.

SECRETARIAL AUDITOR

Pursuant to Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Tapan Shah, Practicing Company Secretary as a Secretarial Auditor to conduct Secretarial Audit of the Company for the financial year 2019-20 (Period from 1st April, 2019 to 31st March, 2020).

The Report of Secretarial Auditor for the financial year 2019-20 is set out as Annexure 4 and it forms a part of this Report.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013, the Central Government has prescribed cost audit related to the Companys product Dye Intermediates and Dyes. Based on this requirement and the recommendation made by the Audit Committee, the Board of Directors has appointed M/s. Kiran J. Mehta & Co., Cost Accountants, Ahmedabad, as the Cost Auditor for the financial Year 2020-21. The Company has received a written certificate from the Cost Auditor stating that their re-appointment, if made, would be within the prescribed limits under sections 141 of the Companies Act, 2013. The Cost Audit report for the financial year 2018-19 has been filed within the prescribed time limits. The Cost Auditors Report does not contain any qualification, reservation or adverse remark. Further, remuneration payable to them is required to be ratified by the Shareholders at the ensuing Annual General Meeting and accordingly, a resolution seeking ratification has been included in the Notice convening the Annual General Meeting.

During the year under review, the statutory auditors, secretarial auditors and cost auditors have not reported any instances of fraud committed in the Company by its officers or employees to the Audit Committee under section143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

MANAGEMENT DISCUSSION & ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, the Management Discussion and Analysis Report for the financial year under review is presented in a separate section, forming part of the Annual Report.

CORPORATE GOVERNANCE

Bodal Chemicals Ltd. is committed to ensuring the highest levels of ethical standards, professional integrity, corporate governance and regulatory compliance. The Company understands and respects its fiduciary duty to all stakeholders and strives to meet their expectations. The core principles of independence, accountability, responsibility, transparency, fair and timely disclosures serve as the basis of the Companys approach to Corporate Governance.

Report on Corporate Governance is annexed and forms an integral part of this Annual Report. Certificate from Mr. Tapan Shah, Company Secretary in practice, regarding compliance of conditions of Report on Corporate Governance as stipulated in the Listing Regulations is also appended to the Report on Corporate Governance.

SECRETARIAL STANDARDS

Secretarial Standards for the Board and General Meetings (SS-1 & SS-2) are applicable to the Company. The Company has complied with the provisions of both these Secretarial Standards.

INDUSTRIAL RELATIONS & HUMAN RESOURCES

Industrial relations at all divisions of your Company have always been cordial and continue to be so. Your Directors wish to place on record their appreciation for the cooperation received from employees at all levels.

HUMAN RESOURCES

Grow Together

Year 2019-20 has been a milestone year from "People Front" in many ways. During the year we designed and announced different operational committees. Our team successfully managed audit of Blue Sign, and we became "Blue Sign Business Partner" and this has added one more feather in our basket.

In line with our restructuring process, our Cross Functional Teams (CFT) worked together for improving our existing operational processes, which resulted in increasing in our throughput time. In the journey of designing "Next Phase" this is one milestone that all CFTs are working well.

We at Bodal strongly believe that Human Asset is most precious and invaluable ASSET of the company. In the current scenario of globalisation and cutthroat competition, it is very much important to maintain and sustain global presence and your company is able to prove that during the year 2019-20. In future also, to maintain that agility in people practices, it is very much important. We do have that framework in place for people practices and procedures.

To keep momentum rolling we have continuous practices and belief in philosophy to Train, Coach, and Mentor our employees at all level. In some areas we have also adopted "Reverse mentoring" model, so long associated employees can learn and understand "Next Practices" of Business, which is need of time. In Learning & Development front we have structured model, where Annual Calendar has been designed based on the organisational requirements, which is monitored, based on Unit and Departmental Training Matrix, which will help us to monitor coverage of team members in mandatory and required training programs. This is also helping us to develop future human asset.

During the year we have organised our flagship program of "Independence Day Celebration" and "Safety Week Celebration" with more value additions. This year we have also organised special program for our Female Team members, "International Womens Day" celebration, which symbolised one of our organisational Value of Equality.

In the year 2019-20, we have taken up the challenge of "Digital HR" by keeping future in mind. During this year we have converted few HR processes, where Employee dependency on HR has reduced. We have created Mobile Platform of My Payroll, where they can view company news, leave details, salary details, and other individual information on real time, also they can download required documents on their fingertips. Along with this we are also focusing on building up of our digital capabilities by aligning our learning and development with new initiatives to minimise impact of technology on work processes.

HEALTH, SAFETY AND ENVIRONMENT (EHS)

Bodal Group is committed towards creating a safe, healthy and eco-friendly work environment providing the leadership and management support which is key to sustainable business growth. We are adopting Beyond the Compliance approach towards adopting and implementing EHS practices across the manufacturing process and the business. EHS principle is integrated into the manufacturing business process to have a sustainable incident free process outcome. Risk based thinking is being developed and adopted as part of the broader loss prevention strategy. Overall a holistic approach is being adopted to manage EHS risks to an acceptable level and as part of the broader Risk management strategy. Continuous training and sensitisation are part of the EHS function to enhance awareness adopting EHS at task level with proper supervision and management leadership oversight. EHS is being driven in a more agile manner with top management intervention to create a safer workplace based on the core belief that "Good Safety means good business". "Personal Protective Equipments (PPE)" are being provided to employees including the workforce. Data of incidents are being collated and RCA (Root Cause Analysis) done and learnings shared widely to prevent further recurrence. Regular practices of scenario based mock exercise are conducted across the plants to check the efficacy of emergency planning and management. Further the improvement areas are noted and are adopted to enhance efficiency and effectiveness. We have fully equipped in-house occupational health center manned round the clock with full time well experienced doctors and nursing assistants. In house ambulance for emergency is also available. Pre medical check-up, annual medical check-up and special health awareness camps are conducted for employees. Medical Team has also initiated "Health Gallery" and company doctor conducts counselling sessions and health talks for employees.

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this Report. You company has issued postal ballot notice for approval of the members of the company for Preferential issue to the Promoters/Promoters Group and to the non-promoters and result has declared by company on 28th June, 2019 and allotted Equity Warrants to the proposed allottees in Board Meeting held on 12th July 2019 and has received 25% amount of total price of Equity warrant amounting Rs. 431.25 Million.

EXTRACT OF THE ANNUAL REPORT

In terms of provisions of Section 92, 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014, the extracts of the Annual Return of the Company in Form MGT-9 is annexed herewith as Annexure 5 to this Annual Report.

ENVIRONMENT PROTECTION

The Company has undertaken various environment friendly measures in its different Units for promoting a better environment. The Company has in place adequate pollution control equipment and all the equipment are in operation.

GREEN INITIATIVE

The Ministry of Corporate Affairs had taken the Green Initiative in Report on Corporate Governance by allowing paperless compliances by Companies through electronic mode. Your Company supports the Green Initiative and has accordingly decided to send necessary communications to its Shareholders to their respective registered E-mail addresses.

SAFETY & WELLBEING OF WOMEN AT THE WORKPLACE

Bodal Chemicals Ltd. has taken various initiatives to ensure a safe and healthy workplace for its women employees. The Company has zero tolerance of sexual harassment at the work place and is fully compliant with the prevailing laws on the prevention of sexual harassment of women at the workplace. As per the provisions of Sections 21 and 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Report on the details of the number of cases filed under sexual harassment and their disposal is as under:

Sr. No. Complaints Under Sexual Harassment (From 01St April 2019 To 31St March, 2020) Status
1 Number of Complaints/Cases pending as at the beginning of 2019-20 i.e. 1st April, 2019 NIL
2 Number of Complaints/ Cases filed during the year (from 1st April, 2019 to 31st March, 2020) NIL
3 Number of Complaints/ Cases as at the end of 2019-20 i.e. 31st March, 2020 NIL

VIGIL MECHANISM AND WHISTLEBLOWER POLICY

The provisions of Section 177(9) and (10) of the Companies Act, 2013 mandates every listed company to establish vigil mechanism for Directors and employees. Bodal Chemicals Ltd. has adopted a Whistle Blower Policy, as part of vigil mechanism to provide appropriate avenues to all the employees of the Company to raise their concerns relating to fraud, malpractice or any other activity or event which is against the interest of the Company or society as a whole. Details of complaints received and the action taken are reviewed by the Audit Committee. No concerns or irregularities have been reported by employees/directors till date.

The functioning of the Whistle Blower mechanism is reviewed by the Audit Committee from time to time. None of the Companys personnel have been denied access to the Audit Committee. The Whistle Blower policy is available on the Companys website and its web link https://bodal.com/live.php?data=6_l2

ANNUAL ACCOUNTS OF SUBSIDIARIES COMPANIES

The Accounts of the Subsidiary Companies for the financial year ended on 31st March 2020 will be made available to any shareholder of the Company on request and will also be available for inspection at the registered office of the Company during working hours till the date of the Annual General Meeting.

Statement containing salient features of financial statements of subsidiaries and Associates pursuant to section 129 of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014 is annexed to this Report in the prescribed Form AOC-1, as "Annexure 1" The Audited Financial Statements of Companys subsidiaries for financial year 2020 are available on the Companys website at www.bodal.com and the same are also available for inspection at the Registered Office of the Company. Your Company will also make available these documents upon request by any Member of the Company interested in obtaining the same.

The Company has laid down policy on material subsidiaries and none of the subsidiary is material subsidiary as per the Policy. The policy is placed on the website of the Company and its weblink is https://bodal. com/live.php?data=6_l2

CONSERVATION OF ENERGY, RESEARCH & DEVELOPMENT (R&D), TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS & OUTGO

The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under section 134(3) of the Companies Act, 2013, read with Rule 8 of Companies (Accounts of Companies) Rules, 2014 is annexed as Annexure 6 to this Report.

RISK MANAGEMENT & INTERNAL CONTROL

The Company has a Risk Management framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimise adverse impact on the business objectives and enhance the Companys competitive advantage. The business risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. Further details are set out in the Management Discussion and Analysis Report forming part of the Directors Report.

The Company deploys robust system of internal controls commensurate to the size of the Company and the complexities of its operations. These systems facilitate fair presentation of its financial results in a manner that is complete and reliable, ensure adherence to regulatory and statutory compliances, and safeguards investor interest by ensuring the highest level of governance and consistent communication with investor The Internal Auditors of the Company conduct financial, compliance and process improvement audits each year. The Audit Committee oversees the scope and evaluates the overall results of these audits, and members of that Committee regularly attend meetings of Board of Directors. The Audit Committee also reviews the adequacy and effectiveness of the internal control system, and invites functional Directors and senior management personnel to provide updates on operating effectiveness and controls, from time to time. A CEO and CFO Certificate, forming part of the Corporate Governance Report, confirm the existence and effectiveness of internal controls and reiterate their responsibilities to report deficiencies, if any, to the Audit Committee and rectify the same.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

During the year, the Company had not provided any corporate guarantee on behalf of others.

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the financial statements.

CORPORATE SOCIAL RESPONSIBILITY

The Companys CSR Policy primarily rests on three broad tenets viz., Healthcare, Education & Community welfare and the same is within the ambit of Schedule VII of the Act. Your Company has a strong focus on making companys CSR efforts more systematic and strategic. Company have established procedures for planning and implementation of major CSR activities in the areas surrounding the companys plants. Your Company is presently focused on the following key areas of CSR:

1. Promoting education, including projects for developing educational infrastructure. a. Build Platform and Shade for the school children so they can play and take lunch.

b. Sanitary blocks for the Boys and Girls, and educate them by the company representatives on good hygiene practices c. Build Computer Labs, to promote digital awareness at the school level.

2. Provide funds to the sports academy for promoting sports and supporting young growing sports persons.

3. Run different projects for the rural development, by interacting and participating with the local village people for better implementation. a. To deepen Village Lake so in monsoon, water harvesting will be possible. Also installed water harvesting infrastructure. b. Construct roads and other required infrastructure at village level.

4. In the year 2019-20 we focused more on the key future challenge related to Water, aim to create necessary infrastructure for the water reservoir and bring about attitude change among communities towards the appropriate use of water.

Further, Company continued several other initiatives under the CSR program, directly as well as through agency namely YUVA Unstoppable permitted under the Act. Details of CSR policy and CSR activities undertaken during the year is annexed to this report as "Annexure 7" and forms part of this Report

BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report for the year ended 31st March 2020 as stipulated under Regulation 34 of the SEBI Listing Regulations is annexed and forms part of this Annual Report.

RELATED PARTY TRANSACTIONS

All the related party transactions that were entered into during the financial year were 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 www.bodal.com and its web link- https://bodal.com/live.php?data=6_l2 Particulars of Contracts or arrangements with Related Parties referred to in section 188 (1) of the Companies Act, 2013, are disclosed in Form AOC-2 as Annexure 8.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY

There are no Significant and Material Orders passed by the Regulators or Courts or Tribunals which would impact the going Concern status and Companys Future Operations.

INSURANCE

The Companys assets are adequately insured.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013, the Directors, to the best of their knowledge and belief, confirm that: (a) in the preparation of the annual accounts for the financial year ended on 31st March 2020,the applicable accounting standards had been followed along with proper explanation relating to material departures; (b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;

(c) the Directors have 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 have prepared the annual accounts for the financial year ended on 31st March 2020 on a going concern basis; (e) the Directors, have 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 have devised proper systems to ensure compliance with provisions of all the applicable laws and that such systems were adequate and operating effectively.

ACKNOWLEDGEMENT

Your Directors place on record their sincere appreciation for the steadfast commitment and highly motivated performance by employees at all levels which was instrumental in sustained performance of the Company. Your Directors also sincerely thank all the stakeholders, professionals, business partners, government & other statutory bodies, banks, financial institutions, analysts and shareholders for their continued assistance, cooperation and support.

For and on behalf of the Board of Directors of Bodal Chemicals Ltd.
SURESH J. PATEL
Date: 6th July, 2020 Chairman & Managing Director
Place: Ahmedabad DIN : 00007400