The Directors have pleasure in submitting the 24th Annual Report together with the Audited financial statements of your Company for the year ended 31st March, 2022.
The summary of your Companys financial performance on standalone basis is given below:
|( Rs in Lakhs)|
|Standalone||Year ended 31st March, 2022||Year ended 31st March, 2021|
|Revenue from Operations||1,44,175.57||1,20,170.67|
|Profit (EBIDTA) before Interest,||24,402.76||17,174.29|
|Depreciation, Taxes &|
|Profit before taxes and||20,901.05||13,424.48|
|Profit before tax||20,327.25||13,424.48|
|- Current Year||5,197.72||3,279.05|
|- Deferred Tax||193.55||15.10|
|Profit for the year||14,935.98||10,130.33|
The summary of your Companys financial performance on consolidated basis is given below:
|( Rs in Lakhs)|
|Consolidated||Year ended 31st March, 2022||Year ended 31st March, 2021|
|Revenue from Operations||1,44,583.00||1,22,432.68|
|Profit (EBIDTA) before Interest,||25,238.00||18,321.92|
|Depreciation, Taxes &|
|Profit before taxes and||21,469.11||13,391.97|
|Profit before tax||20,895.31||13,391.97|
|- Current Year||5,391.30||3,366.04|
|- Deferred Tax||209.53||35.26|
|Profit for the year||15,294.48||9,990.67|
|Add: Share of Profit / (Loss)||0.76||4.76|
|Profit for the Year||15,295.24||9,995.43|
Transfer to Reserves
The Company has transferred a sum of Rs 3,439.58 Lakhs to General Reserve in the current year (previous year Rs 5,460.46 Lakhs).
Highlights / Performance of the Company
Turnover (Net of GST) of the Company for the year increased by 19.92% to Rs 1,43,826.26 Lakhs as compared to Rs 1,19,934.60 Lakhs previous year.
Profit before Depreciation and Taxes & Exceptional Items for the year increased by 42.97% to Rs 23,944.05 Lakhs as compared to
Rs 16,747.52 Lakhs previous year.
Profit after Tax for the year increased by 47.44% to Rs 14,935.98 Lakhs as compared to Rs 10,130.33 Lakhs previous year.
Exceptional Item :
Pursuant to the Memorandum of Understanding (MOU) executed on 17th August, 2021, Share Purchase Agreement executed on 26th August, 2021 and Share Escrow Agreement executed with Federal Bank Ltd. on 23rd November, 2021, by and amongst Cera Sanitaryware Limited (CERA), Anjali Vishnu Holdings Ltd (AVHL) (Joint venture partner and acquirer company) and Anjani Tiles Limited (ATL) (Subsidiary company) for the transfer / divestment of entire stake in Equity and Preference Shares of Anjani Tiles Limited for the total consideration of Rs 2,869.20 lakhs, the Companys shareholdings as at 31st March, 2022 in Equity and Preference shares in ATL have been presented as Non-current Assets classified as held for sale as on 31st March, 2022 as per Indian Accounting Standard –105–"Non-current Assets Held for Sale and Discontinued Operations". Accordingly, Equity shares are measured at the lower of their carrying amount and fair value less costs to sell and Preference shares are measured at fair value which is equivalent to carrying amount as at 31st March, 2022. Due to above arrangements, impairment loss of Rs 573.80 lakhs has been recognised in the Statement as Exceptional Item.
Dividend Final Dividend :
Your Directors recommended a dividend of Rs 20/- per share (400%) [Previous year Dividend of Rs 13/- per share (260%)] on 1,30,05,874 equity shares of Rs 5/- each fully paid for the year ended 31.03.2022, to be paid subject to the approval of the members at the ensuing Annual General Meeting.
Special Dividend :
Your Directors recommended a special dividend of Rs 15/- per share (300%) (Previous year Dividend - Nil) on 1,30,05,874 equity shares of Rs 5/- each fully paid for the year ended 31.03.2022 considering Companys highest growth in terms of turnover and net profit since last 20 years of its operation, to be paid subject to the approval of the members at the ensuing Annual General Meeting.
During the year, the unclaimed dividend pertaining to the financial year ending 2013-14 were transferred to the Investor Education and Protection Fund.
The management has considered the impact of Covid-19 on its profitability, liquidity, supply chain, receivables, inventories, other financial assets and investments.
Even after the second wave and the third wave of Covid-19, your Company has witnessed a surge in consumer demand, both on the new build and the existing home improvement category.
The management will continue to closely monitor any material changes to future economic conditions.
Post Covid-19, your company started ramping up production volumes to its optimum capacity to monetise the sustainable demand generated by the end user for home upgradation, in every geographic location across the country.
Workmen engagement activities like sports day, counselling, reward & recognition schemes have been started which has resulted into positiveness and trust at the shop floor.
Various new initiatives on safety, quality, cost and delivery and compliances on SOP have been implemented resulting into improvement in manufacturing yields and production volume. In order to have repeatability and reproducibility of new SKU and designed product, Standardization of process and its control have been institutionalized.
Good manufacturing practices like waste reduction, KAIZEN, cost saving, and sustainability projects have been implemented to improve the utilization of deployed resources.
Your company continued to develop new/latest designs of one-piece WCs and high-end wall hung WCs to reduce dependency on imports.
Several Covid-appropriate products like rimless WCs, sensor urinals, etc. were rolled out by Sanitaryware unit.
In order to increase the touch points and to enhance the customer experience, your Company has invested in increasing the Cera Style Centres, owned and managed by retailers, in many towns. Your Company has been in the forefront of technology and automation. After successful implementation of 3D printing and robotic glazing technologies, your Company has now added high pressure casting system. These will give your Company a technological edge.
Your company will continue optimum utilization resources and deliver high level of quality product as per customer expectations.
Faucet ware Unit
Your Company has witnessed growth in terms of production and sales volume, which lead the company to reach to the higher level of achievements. Company could achieve the same through various debottlenecking projects, adding balancing equipment, SOP compliances and automation of the processes.
Your Company expects even higher growth in the coming times in its Faucets business. With this in view, company is launching new colour faucet designs in line with the changing customer preferences and market need. A total of 47 new products were launched during the year.
Company will also emphasis the development and sale of WATER saving products which are very crucial for the sustenance of environment and preservation of ecosystem. 47.44% of products in the portfolio are water saving products.
Several Covid-appropriate products like sensor faucets, foot-operated taps, etc. were conceived, developed, and produced by Faucetware division.
Your Company continued launches of new products and designs with 25 new products launched during the year. New Covid-appropriate products like anti-bacterial seat covers were developed and launched.
Senator by CERA
Distribution of your Companys premium offering, Senator, aimed at discerning customers has been widened, to reach more customers.
New products have been added in JEET, your Companys sanitaryware range aimed at affordable segment.
Since its inception, your company CERA is known for its unique sensibility, cutting-edge designs and modern technology when it comes to its products, which forever appeals to the customers evolving needs. Continuing this philosophy of utmost care and precision, CERA ushered its newest product range by launching it under the theme – Unboxing Smiles – on 15th December 2021 in Delhi. This versatile range of products unboxes Modern Living, Style, Functionality as well as Customers Expectations.
From superior design and aesthetics to awe-inspiring styles, futuristic products to the most competitive prices, Unboxing Smiles has everything covered.
The products are smartly segregated into different categories viz. Unboxing Style – which will redefine bathing experience, Unboxing Functionality – which lets you experience never seen before purposefulness, Unboxing Modern Living – which offers classy & elegant designs along with premium pricing and maintenance and
Unboxing Customers Expectations – which showcases irresistible & innovative designs to make the best use of space.
Highest Share of voice in Media
Your company CERA used high impact media strategy to increase the brand reach and consumer exposure. A combination of GEC (General Entertainment Channels) – Impact properties and news program used to expose "Kuch Pal GharKe Naam" on television to consumers. Campaign started in May 2021 where we had advertised our three ads Television Commercial Advertisement in high frequency on 31 Hindi / English news channels. For HSM (Hindi Speaking Market) market, in the month of August 2021 your company took "Kaun Banega Crorepati" the biggest show of Indian Television as associate sponsor, in addition CERA also sponsor popular dance show "Indias best dancer". For Non HSM market, Big Boss Season-5 Telugu version was sponsored for Telangana and Andhra Pradesh market, Co-powered sponsorship in OruChiriIruChiri Bumper Chiri and Star Singer for Kerala market and in last quarter your company advertised heavily in News channels – Hindi, English and Regional languages and covered elections in UP, Punjab, Goa, Manipur & Uttrakhand.
CERA was the most visible brand last year in television and have highest share of voice. 7 out of 10 ads seen (in Sanitaryware category) were of CERA.
Brand CERA in Digital Media
We understand today consumer spends lot of time on social media. Digital campaigns which include series of Product films covering Sanitaryware /Faucetware /Tiles categories - "Tested by expert" and "No Compromise" conceptualised and launched which helped brand to gain lot of popularity and increased consumer engagement. Other initiatives also taken to increase brand recall and search i.e. Google display ads, remarketing and sustenance campaigns, Search engine optimization, Search engine maximization and others.
Trade expansion and development with brand stores
A complete retail expansion program was launched with a view to increase exclusive / non-exclusive brand stores and deliver ultimate consumer experience.
CERA focused to support channel partners by helping them to build brand stores – Cera Style Galleries, Cera Style Hub, Cera Style Centre, Cera Tile Galleries and Cera Tile Centres. This created a strong brand visibility in the market and also give our consumers an experience to remember and facilitate better decision making. CERA also revamped company owned display centre "Cera Style Studio" in Kolkata to support trade.
Product Category Consolidation
CERA also consolidated product categories so that we can deliver better service & meet market expectations. Going forward our efforts will be to build our core businesses - Sanitaryware, Faucet and Tiles.
Retailer Loyalty Programme
CERA Superstar retailer / sub dealer loyalty program was launched towards the purchases made by associate partners (Retailers) from CERAs authorised dealers. The purpose of this program is to strengthen the relationship with the Retailers and provide transparent communication.
Skill development and Training
CERA rigorously conduct training sessions to upskill the knowledge of plumbers and masons. This enables them to get better wages , resolve customer query satisfactorily and install products hassle-free.
CERA won the most affiliated awards consecutively for the third time in a row such as "Trusted brand" and "Super brand".
Your company made rapid strides in the Tiles segment by launching new designs Slabs, large format sizes of 1200x2400mm, 1200x1200mm and 800x1600mm and also new designs and sizes in both floor and wall categories.
In 2015 the company had entered into a Joint Venture with Anjani Tiles Ltd at Andhra Pradesh with 51% Equity and Milo Tiles LLP (earlier Crown Ceramics–an established production facility) at Morbi, Gujarat with 26% Equity (since 2019) for producing high end Glazed Vitrified Floor Tiles aggregating to 16000 Sq. Mtr. per day. With your company deciding to monetise its equity in ATL, the JV arrangement with ATL at Andhra Pradesh has come to end by entering into MOU and SPA (Share Purchase Agreement) in August 2021. The proceed of Preference and Equity Shares are being received in phased manner.
CERA holds an Equity of 51% in Joint Venture unit for manufacture of corrugated boxes which has now achieved full utilisation of production. The products are now available on a just in time basis, built to the exact specifications for the Company. The capacity utilization has increased considerably during the year.
The Joint venture for Polymer Products unit for manufacturing of seat covers and cisterns has reached optimum capacity of its production during the year. Cera holds 51% Equity. The quality products are available and capacity utilization has increased gradually during the year.
Green Energy Unit
As a part of national policy and Green initiative, which was initiated in 1995, Company has energy security and stabilized power cost by generation of electricity through non-conventional sources for captive use through wind and solar.
The current installed capacity of Non-Conventional Energy unit of the Company stands to 10.325 M.W.
The non-conventional Wind and Solar Power has produced 156.88 lakhs KWH for captive use.
Conservation of energy, technology absorption and foreign exchange earnings and outgo: Conservation of energy
The Company has two sources of its main energy, viz. Natural Gas - GAIL and Sabarmati Gas Ltd., for operating its Sanitaryware plant. The pricing of both sources differ, as GAIL sources gas from isolated wells in and around Ceras manufacturing facility, and is able to contract gas at a lower price over prevailing market pricing. Medium term contracts with these suppliers are renewed on aperiodic basis. For energy conservation, the company has installed fuel efficient burners to control gas consumption and in addition to this, every effort is made by the company to adapt any technological developments in energy conservation.
The second energy, viz. electricity, required for running the machineries, is supplied by the local Discom. To compensate the energy consumption by way of electricity, your Company has an installed capacity of Wind Turbines of 8.325 MW and Solar Plants of 2.00 MW which generates about 70% of the companys electricity requirement and this gets offset against monthly consumption of the energy bill.
Technology absorption and foreign exchange earnings and outgo
The information on technology absorption and foreign exchange earnings and outgo stipulated under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as a separate Annexure- III.
Environmental Social Governance (ESG)
Cera Sanitaryware follows a holistic approach towards Environmental, Social and Governance matters. Cera Sanitaryware values the trust reposed by its stakeholders including customers, the communities in which it operates and society at large and has strived hard to protect and preserve their interests.
Environment at Cera Sanitaryware
Cera is highly committed to ensuring zero environmental impact due to its operations. The Company stringently adheres to norms governing reduction of emissions, pollution control and other environmental aspects. Some of the broad initiatives undertaken by the Company include:
? Installation of a rooftop solar power system (one of the largest in the Kadi region), which has gone a long way in substantially reducing the carbon footprint.
? Cera has managed to stabilize power cost by generating electricity through non-conventional sources (wind and solar) for captive use; as of FY22, its total installed non-conventional energy capacity stood at 10.325 MW, which produced 15.69mn unit. 70% of its energy needs are met through renewable energy.
? In its initiative to conserve biodiversity, the Company has undertaken plantation of over 10,000 plus trees.
? By successfully developing a fully functional rainwater-harvesting system, Cera has managed to reduce dependence on ground water usage. Further, by recycling water used for the manufacturing process the Company has reduced the water intensity of its operations.
? Under the initiative of ‘Waste Minimization and Waste Utilization, the Company has been undertaking numerous measures. Some of these measures include recycling of solid and liquid and ZLD (zero liquid discharge), high energy efficient rated machines, compliance to pollution norms and awareness generation among employees etc. Majority of the waste generated in the companys operations is recycled and the balance is disposed-off safely. The Company has also installed a Effluent Treatment Plant at both of its facilities.
Social dimension at Cera Sanitaryware
For the past several years, Cera has been actively involved in various social welfare activities. Over a span of 5 years, Cera has spent more than Rs 15 crore for development within Kadi district (a tier 3 developing industrial area) and surrounding areas. Additionally, the Company at regular intervals provides necessary safety and skill up-gradation training to its permanent as well as its contractual employees. The Company has systems in place to ensure no child labour, forced or involuntary labour at its facilities. During the financial year 2021-2022, the Company has spent Rs 29.10mn towards CSR activities mainly in the areas of education, healthcare, rural development, woman empowerment and eradicating hunger. Governance at Cera Sanitaryware Adhering to the best Corporate Governance practices has been a strong endeavor of the Company since its inception. The organization strongly believes that there is a direct association between good corporate governance practices and stakeholder value enhancement. To ensure protection of interests of all stakeholders of the Company, Cera has adopted various strict governance related policies to the best governance practices. Its policy relating to ethics, bribery and corruption serves as the guiding philosophy for its employees as well as the employees of its subsidiary and JV companies. The Company also has a whistleblower policy in place, which provides a platform to all employees, vendors and customers to report any suspected fraud or error or confirmed incident of fraud/misconduct. Through prudent strategies the Company has optimized asset utilization and preserved the collective funds at its disposal by avoiding unrelated diversification or over-ambitious expansion. By ensuring fair and ethical dealings with all stakeholders, the Company has a robust track record of Corporate Governance practices.
Going ahead, the Company aspires to continue deepening its focus towards the environmental social governance (ESG) aspect in the organization and create a sustainable future for all its stakeholders.
The Company has one Subsidiary Company and two Subsidiary LLPs namely Anjani Tiles Limited and Packcart Packaging LLP & Race Polymer Arts LLP respectively.
There are no associate companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). Further there has been no material change in the nature of business of the subsidiary. The Company does not have any material subsidiary. The Policy on Material Subsidiary framed by the Board of Directors of the Company is available on Companys website at the link https:// www.cera-india.com/corporate/policy-for-determining-material-subsidiary/.
Those Shareholders who are interested in obtaining a copy of the audited annual financial statements of the subsidiary may write to the Company. The Audited financial statements of all subsidiaries are available on the website of the Company www.cera-india.com.
Pursuant to the provisions of Section 129, 134 and 136 of the Companies Act, 2013 with rules made thereunder and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has prepared consolidated financial statements of the Company and salient features of the financial statement of the subsidiaries is set out in the prescribed form AOC-1 forming part of this Annual Report.
Further, your Company has decided for divestment of entire stake in one of its Subsidiaries, viz Anjani Tiles Limited and pursuant to the Resolution passed at the Board Meeting held on 5th August, 2021 for consideration of the proposal and in principle approval for divestment of the Companys entire stake in Anjani Tiles Limited, a subsidiary company, a Memorandum of Understanding (MOU) was executed on 17th August, 2021 by and amongst Cera Sanitaryware Limited (Cera), Anjani Vishnu Holdings Ltd (AVHL) (Joint Venture Partner and Acquirer Company) and Anjani Tiles Limited (ATL) (Subsidiary Company) for the transfer / divestment of entire stake in Anjani Tiles Limited , consisting of 1,02,00,000 Equity shares of
Rs 10/- each and 2,42,30,000 1% Cumulative Redeemable Preference shares of Rs 10/- each on a fully diluted basis, for a total consideration of Rs 2,869.20 Lakhs.
The Company, AVHL and ATL also entered in to Share Purchase Agreement (SPA) dated 26th August, 2021 pursuant to which the Company agreed to sell all the Equity and Preference Shares held by it in ATL to AVHL.
Total consideration as referred above, will be received by the Company in one or more tranches, beginning from 30th September, 2021 and completing on 31st March, 2023 through an escrow mechanism and as per the Payment Schedule set out in the MOU. Accordingly, the first tranche of Rs 643.00 Lakhs has been received on 28th September, 2021 from the Acquirer Company and 64,30,000 Preference Shares of ATL have been transferred (off market) to AVHL on 29th September, 2021.
Further, pursuant to the MOU and SPA, the Share Escrow Agreement was executed by the Company, AVHL and ATL with Federal Bank Ltd. (Escrow Agent) jointly on 23rd November, 2021. Both Cera and AVHL have transferred their respective entire Equity shareholding and their respective balance Preference shareholding to the Escrow Account in January, 2022 with lien marked in favour of the Escrow Agent.
Companys shareholdings in Equity and Preference shares in ATL have been presented as Non-current Assets classified as Held for Sale as on 31st March, 2022 as per Indian Accounting Standard -105 - "Non-current Assets Held for Sale and Discontinued Operations", measured at the lower of its carrying amount and fair value less costs to sell in respect of Equity shares and at fair value in respect of Preference shares as at 31st March, 2022. The impairment loss of Rs 573.80 Lakhs on Equity Shares (Preference shares to be transferred at fair value which is equivalent to carrying amount) due to above arrangements has been recognised in the Statement of Profit and Loss as Exceptional Item.
Particulars of contracts or arrangements with related parties
All transactions entered with Related parties as defined under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 during the financial year were in the ordinary course of business and on an arms length basis, the details of which are included in the notes forming part of the financial statements.
There were no material related party transactions entered during the year. Accordingly, information in form AOC - 2 is not annexed. Further no materially significant related Party transactions were made by the Company with Directors, Key Managerial Personnels or other Designated Persons, which may have a potential conflict with the interest of the Company at large. All related party transactions were placed before the Audit Committee and also the Board for approval. Pursuant to recent amendments in the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in respect of related party transactions, the Board of Directors have revised the Policy on related Party transactions w.e.f. 1st April, 2022 and the same is uploaded on the Companys website i.e. www.cera-india.com.
Corporate Social Responsibility
Your Company has always laid emphasis on progress with social commitment. We believe strongly in our core values of empowerment and betterment of not only the employees but also our communities. Following this principle the Company had laid the foundation of a comprehensive approach towards promoting and facilitating various aspects of our surrounding communities.
The Board has approved a policy for Corporate Social Responsibility and same has been uploaded on the website i.e. www.cera-india.com. As required under Section 135 of the Companies Act, 2013 and to demonstrate the responsibilities towards Social upliftment in structured way, the Company has formed a Policy to conduct the task under CSR, during the year. The Annual Report on Corporate Social Responsibility (CSR) Activities alongwith Annexure as per Rule 8 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as a separate Annexure–IV and separate activity wise CSR Report has been annexed as per Annexure -II.
Directors and KMP
Shri Sajan Kumar Pasari, Shri Lalit Kumar Bohania, Shri Surendra Singh Baid and Ms. Akriti Jain are the Independent Directors of the Company and they will not retire by rotation. All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and there has been no change in the circumstances which may affect their status as Independent director during the year under review and have also confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence. The Company keeps informed independent directors about changes in the Companies Act, 2013 and rules and other related laws from time to time and their role, duties and responsibilities. Shri Surendra Singh Baid is proposed to be re-appointed as Independent Director for further term of Five years at the ensuing Annual General meeting of the Company.
Due to personal reasons Shri Atul Sanghvi resigned as Executive Director & CEO of the Company from the end of 14th October, 2021. The Board placed its warm appreciation for the contribution made by him as an Executive director during the tenure on the Board of the Company.
Upon the recommendation of Nomination and Remuneration Committee, the Board of Directors has appointed Shri Anupam Gupta as an Additional Director of the Company w.e.f. 15th October, 2021. Subsequently at the same meeting, he was appointed as an Executive Director (Technical) of the Company for period of 3 years w.e.f. 15th October, 2021 subject to approval of the members at the ensuing Annual General meeting of the Company.
The Board of Directors has re-appointed Shri Ayush Bagla as an Executive Director for a period of three years w.e.f. 14th May, 2022 and Shri Vikram Somany as Chairman and Managing Director for a period of five years w.e.f. 1st July, 2022. Their appointments are subject to approval of the members at the ensuing Annual General Meeting of the Company.
Smt. Deepshikha Khaitan, is liable to retire at the end of the ensuing Annual General Meeting and being eligible, offers herself for reappointment.
The resolutions proposing the appointment/reappointment of the Directors are set out in the notice convening Annual General Meeting for approval of members.
Brief resume of the director who is proposed to be reappointed at the ensuring Annual General meeting, as required as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided in the notice convening this Annual General Meeting of the Company.
There was no other change in the Key Managerial Personnel during the year under review except mentioned as above.
Number of Meetings of the Board
The Board of Directors, during the financial year 2021-22 duly met 6 times on 02.06.2021, 10.06.2021, 05.08.2021, 31.08.2021, 26.10.2021 and 24.01.2022 in respect of these meetings, proper notices were given and the proceedings were properly recorded and signed in the Minutes Book maintained for the purpose.
The Company has constituted Audit Committee in terms of the requirements of the Act and rules framed thereunder and applicable listing regulations. For details please refer Corporate Governance Report attached as a separate Annexure-VI.
Directors Responsibility Statement
In compliance of Section 134(5) of the Companies Act, 2013, the Directors of your Company confirm: ? that in the preparation of annual accounts, the applicable accounting standards have been followed and there are no material departures; ? that such accounting policies have been selected and applied 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 as on 31st March, 2022 and of the Profit of the Company for the year ended on that date; ? that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; ? that the annual accounts have been prepared on a going concern basis; ? that internal financial controls have been laid down to be followed by the company and that such internal financial controls are adequate and were operating effectively; ? that proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Pursuant to the provisions of the Companies Act, 2013 and Rules made thereunder, Schedule - IV of the Act and SEBI (LODR) Regulations, 2015, the Board has carried the evaluation of its own performance, individual directors, its committees and Key
Managerial Personnel, on the basis of attendance, contribution and various criteria as recommended by the Nomination and Remuneration Committee of the Company.
The performance of Non-Independent Directors (including the chairperson) and the Board as whole was also evaluated by the Independent Directors at the separate meeting of Independent Directors of the Company. The Directors expressed their satisfaction with the evaluation process.
Policy on Directors appointment and remuneration
Criteria determining the qualifications, positive attributes and independence of Directors.
Qualifications of Independent Director.
An Independent director shall possess appropriate skills, qualifications, experience and knowledge in one or more fields of finance, law, management, marketing, administration, corporate governance, operations or other disciplines related to the Companys business.
Positive attributes of Independent Directors.
An independent director shall be a person of integrity, who possesses knowledge, qualifications, experience, expertise in any specific area of business, integrity, level of independence from the Board and the Company etc. Independent Directors are appointed on the basis of requirement of the Company, qualifications & experience, expertise in any area of business, association with the Company etc. He/She should also devote sufficient time to his/her professional obligations for informed and balanced decision making; and assist the Company in implementing the best corporate governance practices.
Independence of Independent Directors.
An Independent director should meet the requirements of Section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015 and give declaration to the Board of Directors for the same every year.
Other Directors and Senior Management
The Nomination and Remuneration Committee shall identify and ascertain the qualifications, expertise and experience of the person for appointment as Director or at Senior Management level and recommend to the Board for his / her appointment.
The Company shall not appoint or continue the employment of any person as Whole-time Director or Senior Management Personnel if the evaluation of his/her performance is not satisfactory. Other details are disclosed in the Corporate Governance Report under the head Nomination and Remuneration Committee and details of Remuneration (Managing Director / Whole Time Director(s) and Non-Executive Directors) are attached as a separate Annexure-VI to this Report.
Familiarisation Programme for Independent Directors
The Directors are regularly informed during meetings of the Board and Committees on the business strategy, business activities, manufacturing operations and issues faced by the ceramic industry. The Directors when they are appointed are given a detailed orientation on the Company, industry, regulatory matters, business & financial matters, human resource matters and corporate social responsibility. The details of Familiarisation programmes provided to the Independent Directors of the Company are available on the Companys website www.cera-india.com.
Remuneration / Commission from Holding or Subsidiary Company
Managing Director or Whole Time Director is not receiving any remuneration / commission from any Holding Company or Subsidiary Company.
This Nomination and Remuneration Policy ("Policy") provides the framework and key guiding principles to be followed in for appointment and determination of remuneration of Directors, Key Managerial Personnel and Senior management personnel. This Policy is to establish and govern the procedure applicable: a) To evaluate the performance of the members of the Board. b) To ensure remuneration to Directors, KMP and Senior Management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals. c) To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.
The said Policy is available on the website of the Company www.cera-india.com
Managerial Remuneration and Employees
Details required pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are enclosed as a separate Annexure-V.
Details of employees required pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed as a separate Annexure, however it is not being sent along with this annual report to the members of the Company in line with the provisions of Section 136 of the Companies Act, 2013 and rules made there under. Members who are interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company. The aforesaid Annexure is also available for inspection by members at the Registered Office of the Company, 21 days before and up to the date of the ensuing Annual General Meeting during the business hours on working days.
Company has not offered its shares to its employees under ESOS during the year under review.
Company has not sanctioned loan to any of its employees for purchase of Companys shares under any scheme.
Corporate Governance and Management Discussion and Analysis
Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, report on Corporate Governance along with Practicing Company Secretarys Certificate on its compliance and Management discussion and Analysis have been included in this Annual Report as per separate Annexure-VI and Annexure-I respectively.
Business Responsibility Reporting
As required under Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Business Responsibility Report forms part of the Directors Report and is enclosed as separate Annexure-VII.
Pursuant to Section 134(3)(a) and Section 92(3) of the Act, the Copy of Annual Return of the Company for the financial year ended March 31, 2022 will be placed on the Companys website at www.cera-india.com.
Particulars of Loans, guarantees or investments u/s 186.
The loans if any, made by the Company are within the limits prescribed u/s 186 of the Companies Act, 2013 and no guarantee or security is provided by the Company. Details of Investments covered u/s 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.
Risk Management Policy
The Board has approved and implemented Risk Management Policy of the Company including identification and element of risks. Pursuant to amendments in SEBI (Listing Obligations and Disclosure Requirements Regulations), 2015, the Board of Directors of the Company has constituted the Risk Management Committee having its scope and functions as per Risk Management policy. The Committee shall also review cyber security matters of the company at various levels and also take necessary actions from time to time to mitigate the cyber risk to the Company in accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness.
The Risk Management system is also overseen by the Audit Committee / Board of Directors of the Company on a continuous basis. The major risks identified by the businesses are systematically addressed through mitigation actions on a continual basis.
Internal Control System and its adequacy
The Company has internal control system commensurate with the size, scale and complexity of its business operations. The scope and functions of Internal Auditor are defined and reviewed by the Audit committee. The Internal Auditor reports to the Chairman of the Audit Committee. The Internal Auditor assesses opportunities for improvement of business processes, systems and controls, to provide recommendations, which can add value to the organization.
The paid-up Equity Share Capital as on 31st March, 2022 was Rs.650.29 Lakhs. During the year under review the Company has not issued any shares.
No shares with differential voting rights, stock or sweat equity shares were issued by the Company during the year under review. During the year the Company has transferred 4746 Equity Shares to Investor Education and Protection Fund, pursuant to the provisions of sections 124 & 125 of the Companies Act, 2013 and Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016.
The Company has contributed Rs 16,131 Lakhs to the exchequer by way of GST, customs duty, service Tax, income tax, VAT, salestax and other fiscal levies.
The Company has not accepted and not renewed any deposits falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.
During the year under review, the Company does not have any long term loans/debts from Financial Institutions and Banks. The Company is availing Working Capital facility from State Bank of India.
During the year there is no default in payment of loan facility availed from Bank or Financial Institution, therefore details of difference between amount of valuation done at the time of one time settlement and valuation done while taking loan from bank or financial institutions is not applicable.
Auditors and their Observations
N.M. Nagri & Co., Chartered Accountants were appointed as Auditors at 19th Annual General Meeting (‘AGM) held on 27th July, 2017 to hold the office of the Auditors up to the conclusion of the 24th Annual General Meeting.
The existing Auditors firm has completed terms of five consecutive years pursuant to Section 139(2) of the Companies Act, 2013. The Audit Committee and the Board of Directors have recommended appointment of Singhi & Co., Chartered Accountants (Firm Registration No.302049E) as the Statutory Auditors of the Company for a term of five years from the conclusion of 24th AGM till the conclusion of the 29th AGM (AGM of Financial year 2026-27) subject to the approval of the members at the ensuing Annual General meeting.
Singhi & Co., Chartered Accountants, have consented to the said appointment and confirmed that their appointment, if made, would be within the limits specified under Section 141(3)(g) of the Act. They have further confirmed that they are not disqualified to be appointed as statutory auditors in terms of the provisions of the proviso to Section 139(1) and Section 141(3) of the Act and the provisions of the Companies (Audit and Auditors) Rules, 2014. The Auditors Report and Secretarial Audit Report to the members for the financial year under review does not contain any qualification, reservation or adverse remark or disclaimer.
The Statutory Auditors have not reported any fraud during the year under review.
Cost Records and Cost Auditors
The Company is required to maintain cost records under Companies (Cost Records and Audit) Rules, 2014. Accordingly, cost records have been maintained by the Company. The Company has appointed K.G. Goyal & Co., as Cost Auditors for conducting cost audit for the year 2022-23.
Pursuant to provisions of Section 204 of Companies Act, 2013 and rules made there under, the Company had appointed Parikh Dave & Associates, Practicing Company Secretaries to undertake the Secretarial Audit of the Company for the year 2021-22. The Secretarial Audit Report for the year 2021-22 given by Parikh Dave & Associates, Company Secretaries in practice is annexed with this report.
The Company is complying with the applicable Secretarial Standards.
Your Company has adequately insured all its properties including Plant and Machinery, Building and Stocks.
The Company has in the past signed bilaterally negotiated four year wage agreements with workmen with detailed quantification of fixed and variable wages. A similar agreement on completion of the previous agreements tenure was signed under section 2(p) 18(1) of Industrial Disputes Act, 1947, for 4 years with workers Union on 4th August, 2021 which took effect on 1st September, 2021. The new wage agreement was executed in harmonious environment and without any labour unrest and loss of production.
The Company has adequate skilled & trained workforce for its various areas of operations and the skills upgradation of which is being done on continuous basis for improving the plant operations and quality process.
The Company has taken sufficient measures to maintain Industrial Health and Safety at its workplace for employees as laid in the Gujarat State Factories Rules, 1963. The Company is also complying and maintaining all applicable Industrial and Labour laws/ rules.
The Company has in place a Policy against Sexual Harassment at workplace in line with the requirement of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committees have been set up to redress complaints received regarding sexual harassment. The Company has not received any complaints during the year under the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has organized 2 workshops under the said Act during the year under review.
Material changes affecting financial position of the Company
No material changes or commitments, affecting the financial position of the Company have occurred between the end of the financial year of the Company to which the financial statements relate, i.e. 31st March, 2022 and the date of the Boards Report.
There is no application pending under the Insolvency and Bankruptcy Code 2016 against the Company.
Change in nature of business
No changes have been made in nature of business carried out by the Company during the financial year 2021-22.
Orders passed by Regulatory Bodies or Courts
No regulatory body or court or tribunal has passed any significant and material orders impacting the going concern status and operations of the Company.
The Company has implemented Vigil Mechanism. For details please refer Corporate Governance Report attached as a separate
Your Directors thank the Financial Institutions and Bankers for extending timely assistance in meeting the financial requirements of the Company. They would also like to place on record their gratitude for the co-operation and assistance given by State Bank of India and various departments of both State and Central Governments.
|For and on behalf of the Board of Directors,|
|For Cera Sanitaryware Limited|
|Ahmedabad.||Chairman and Managing Director|
|10th May, 2022||(DIN:00048827)|