Deccan Cements Ltd Directors Report.

Dear Shareholders,

The Directors of your company are glad to present the 41st Annual Report together with the Audited Financial Statements of the Company for the Financial Year ended 31st March, 2021.

Financial Results

The Financial Results for the year ended 31st March, 2021 are summarized below: (Rs. in Lakhs)

Particulars 2020-21 2019-20
Revenue from operations 75,795.18 55,533.46
Other Income (net) 1,010.58 955.66
Total Income 76,805.76 56,489.12
Operating expenses 58,210.04 47,703.81
Depreciation and amorti- zation expenses 2,317.09 2,091.25
Total expenses 60,527.13 49,795.06
Profit before Finance cost and Tax and Exceptional Item 16,278.62 6,694.06
Less: Finance cost 742.60 677.62
Exceptional Item 0.00 962.41
Current tax 3,890.42 1,235.89
Deferred tax 132.86 (1,846.24)
Net Profit after Tax 11,512.75 5,664.38
Other comprehensive income (5.00) (5.06)
Total comprehensive income for the year 11,507.75 5,659.32
Profit brought forward from previous year 38,400.00 34,049.42
Less: Dividend (including Corporate Dividend Tax) 0.00 (1,308.74)
Closing Balance of Profit 49,907.75 38,400.00
Earnings Per Share (in Rs.) 82.19 40.44

Results of Operations:

The profit after tax of the Company for the current year was at Rs.11,512.75 Lakh as compared to the previous year profit of Rs.5,664.38 Lakh. During the year there is no change of business.

The Financial statements are required to be presented in accordance with the Ind-AS requirements from the financial year 2018-19. As per Ind-AS require -ments GST, rebates and discounts are reduced from the Gross revenue. (Rs. in Lakhs)

Particulars 2020-21 2019-20
Sale of products
(a) Cement - Net Revenue 75,078.51 54,838.63
(b) Power*
(Net of charges for wheel- ing, banking)
Wind 18.76 47.68
Hydel 349.67 519.30
Thermal - -
Power Net Revenue 368.43 566.98
Other operating revenues
Scrap sales 119.06 127.85
Sales Tax Incentives** 229.18 -
Revenue ( Net of Taxes
and Rebates) 75,795.18 55,533.46

* includes unbilled revenue.

** During the year, the company has received sales tax incentive of Rs. 229.18 lakhs pertaining to FY 2013- 14.

Operational Results are further elaborated in the Management Discussion and Analysis Report.

Dividend:

In consonance with the Company’s policy of rewarding its shareholders on a consistent basis, your directors have recommended final dividend of Rs.5/- per equity share i.e. @100% dividend on the Equity Share Capital of the Company for FY 2020-21, subject to approval of the members in the ensuing annual general meeting of the Company.

The cash outflow for the final dividend FY 2020-21, if declared by the members, will be Rs.700.38 Lakh.

The cash outflow for dividend declared for FY 2019- 20 was Rs.560.30 Lakh and Rs.115.19 Lakh towards tax on dividend totaling to Rs.675.49 Lakhs.

Your directors have not proposed to transfer any sum to Reserves for the financial year 2020-21.

Capital Structure:

There is no change in the capital structure during the year.

Deposits:

During the year under review, the Company has not invited / accepted any amount falling within the purview of provisions of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

Management Discussion and Analysis Report:

A report on the Management Discussion and Analysis is appended to this Report.

Business Responsibility Report:

Business Responsibility Report as per regulation 34 of the listing regulations forms part of this Annual Report.

Corporate Governance:

The Company’s Report on Corporate Governance is attached, and forms part of this Report.

Certificate -pany M/s. M Anandam & Co., Chartered Accountants confirming the compliance with the conditions of Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is appended to this Report.

Transfer to Investor Education and Protection Fund (IEPF):

During the year, the Company has transferred a sum of Rs.2,25,606/-, the unclaimed and unpaid dividend pertaining to the Financial Year 2012-13, to the Investor Education and Protection Fund (IEPF) in compliance with applicable provisions of the Companies Act, 2013. The amount supposed to be transferred to the IEPF by 18th October 2020. Accordingly, your Company had taken necessary steps to transfer the unclaimed and unpaid dividend to the IEPF on or before 18th October 2020, and the Dividend payment banker had transferred the said unclaimed and unpaid dividend to account of the IEPF by NEFT on 14th October 2020. However, due to some technical reasons the linking of the UTR with the Challan couldnot happen. In this connection, your Company raised a service request with the MCA. However, the problem was not resolved, and on 26th October 2020 the dividend payment banker informed your company that due to non-linking of the UTR with the SRN, the amount returned to the account. On the same day your company requested the dividend payment banker to transfer the unclaimed and unpaid dividend to the IEPF, and the dividend payment banker transferred the same to the account of the IEPF by NEFT on 26th October 2020, and this time your Company succeeded to link the UTR with the SRN of the Challan. Due to the above stated reason, there was a delay of 8 days in transferring the unclaimed and unpaid dividend to the IEPF. Further, the unclaimed and unpaid dividend amount pertaining to the Financial Year 2013-14 is due for transfer to IEPF on 30th October, 2021. The year wise details of unpaid and unclaimed amounts lying with the Company as on 31st March, 2021 is available in the Company’s website "www.deccancements. com". Shareholders are advised to check their unpaid and unclaimed dividend status and contact the Company for encashment of the same, if depicting unpaid. Section 124(6) of the Companies Act, 2013 read with the Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 mandates companies to transfer shares in respect of which dividends remain unpaid / unclaimed for a continuous period of seven years to the IEPF. Adhering to the various requirements set out in the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Com-year 2020-21, panyhas,duringfinancial transferred

6,422 equity shares belonging to 27 shareholders to the IEPF Authority in respect of which dividend had remained unpaid or unclaimed for seven consecutive years or more as on the due date of transfer, i.e., 18th September 2020, through corporate action on 28th October, 2020 to the demat account of IEPF Authority held with NSDL. Details of shares so far transferred to the IEPF Authority are available on the website of the Company and the same can be accessed through the link: "http://www.deccancements.com/shareholders-information.php". The said details have also been uploaded on the website of the IEPF Authority and can be accessed through the link: "www.iepf.gov.in". Similarly, the shares in respect of which dividend are unpaid / unclaimed for a continues period of seven years, since the dividend declared for Financial Year 2013-14,are due for transfer to IEPF on 30th October, 2021.

The details of unpaid and unclaimed dividends lying with the Company as on March 31, 2021 are uploaded on the website of the Company and can be accessed through the link "https://deccancements. com/shareholders-information.php". The concerned members/investors are advised to visit the weblink "http://www.deccancements.com/ shareholders-information.php" or visit the weblink of the IEPF Authority "http://www.iepf.gov.in/IEPF/ refund.html", or contact the Company’s RTA (KFin Technologies Pvt. Ltd.), for detailed procedure to lodge the claim with the IEPF Authority.

Due dates for transfer to IEPF, of the unclaimed/unpaid dividends for the financial year 2013-14 and thereafter, are as under:

Financial Year Date of Declara- tion Face Value per Share (Rs.) % of Dividend Declared Dividend per Share (Rs.) Unclaimed and unpaid Dividend as on 31.03.2021 (Rs.) No. of Shares on which dividend un- claimed and unpaid as on 31.03.2021 Due date of transfer to IEPF
2013-14 29.09.2014 10 12 1.20 1,55,938 1,29,887 30.10.2021
2014-15 22.09.2015 10 25 2.50 3,22,754 1,29,102 26.10.2022
2015-16* 16.03.2016 10 50 5.00 6,57,965 1,31,593 20.04.2023
2016-17 11.08.2017 10 60 6.00 7,35,480 1,22,580 10.09.2024
2017-18 10.08.2018 5 60 3.00 4,73,788 1,57,929 13.09.2025
2018-19 07.08.2019 5 75 3.75 5,15,587 1,37,490 13.09.2026
2019-20* 28.02.2020 5 80 4.00 6,39,792 1,59,948 07.03.2027

* Interim Dividend

Directors and Key Managerial Personnel:

Pursuant to Section 152 of the Companies Act, 2013 Mr. R Gopalakrishnan (DIN: 00296413) is liable to retire by rotation at the forthcoming Annual General Meeting and being eligible has offered himself for reappointment. The Board recommends his reappointment.

Brief resume of the Director(s) retiring by rotation, seeking appointment, including nature of their experience in specific functional areas, names of companies in which they hold directorship and membership of committees of the Board is appended to the Notice calling the 41stAnnual General Meeting.

Familiarization program for Independent Directors:

The Company has adopted a familiarization programme prepared in the line of Regulation 25(7) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 for Independent Directors to familiarize them with the Company’s philosophy, vision, mission, strategies, operations and functions. The details of the familiarization programme are available on the Company’s website at "www.deccancements.com".

Declaration by Independent Directors:

Your Company has received necessary declaration from each independent director under Section 149 of the Companies Act, 2013, confirming that he/she meets the criteria of independence laid down in Section 149 of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

Statutory Auditor:

M/s. M Anandam & Co., Chartered Accountants, Secunderabad, were appointed as Statutory Auditors of the Company in the 37th annual general meeting of the Company held on 11th August, 2017 for a period of five years i.e. till the conclusion of the 42nd annual general meeting to be held in the year 2022 for FY 2021-22.

The Notes on the financial statements referred to in the Auditors’ Report are self explanatory and do not call for any further comments. The Auditors’ Report does not contain any qualification, reservation or adverse remark, except delay in transferring the unclaimed and unpaid dividend for FY 2012-13 to the IEPF. Your Director reiterates the reasons stated in "Transfer to Investor Education and Protection Fund (IEPF)" for the delay of 8 days in transferring the unclaimed and unpaid dividend for FY 2012-13 to the IEPF.

Cost Auditor:

M/s. Aruna Prasad & Co., Cost Accountants, Chen-nai, has been reappointed by the Board of Directors as Cost Auditor of the Company for the Financial Year 2021-22. The remuneration of the cost auditor is required to be ratified by the members in accordance with the provisions of Section 148 of the Companies Act, 2013 read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014. Accordingly, the matter is being placed before the Members for ratification at the ensuing Annual General Meeting.

Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company engaged the services of M/s. V. Shankar & Co., Company Secretaries, Hyderabad to conduct the Secretarial Audit of the Company for the financial year ended 31st March, 2021. The Secretarial Audit Report in Form MR-3 is annexed to this Report (Annexure I). There has been no qualification, reservation, adverse remarks or disclaimer in the Secretarial Audit Report, except delay in transferring the unclaimed and unpaid dividend for FY 2012-13 to the IEPF. Your Director reiterates the reasons stated in "Transfer to Investor Education and Protection Fund (IEPF)" for the delay of 8 days in transferring the unclaimed and unpaid dividend for FY 2012-13 to the IEPF.

Annual Return:

The Annual Return for FY 2020-21 is available on the website of the Company and the same can be accessed through the link: "http://www.deccancements. com/shareholders-information.php".

Board Meetings:

During the year, Four (4) meetings of the Board of Directors were convened and held. The details of the meetings of the Board are furnished in the Corporate Governance Report which forms part of this Report.

Directors’ Responsibility Statement:

Pursuant to the provisions of Section 134(3)(c) and 134(5) of the Companies Act, 2013, relating to Directors’ Responsibility Statement, your Directors, confirm that:

a) in the preparation of the annual accounts for the year ended 31st March, 2021, the applicable accounting standards had been followed and there are no material departure;

b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year 31st March, 2021 and of the profit of the company for the year ended on that date;

c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) the directors had prepared the annual accounts for the year ended 31st March, 2021 on a going concern basis;

e) the directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;

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

CEO/CFO Certification:

The CEO and CFO certification on the Financial Statements for Year 2020-21 is provided elsewhere in this Annual Report.

Policy on Directors’ appointment and remuneration and other details:

The Company’s policy on directors’ appointment and remuneration and other matters has been disclosed in the Corporate Governance Report, which forms part of this Report.

Particulars of loans, guarantees or investments under Section 186:

The Company has not granted any loans, secured or unsecured, which falls under the provisions of Section 186 of the Companies Act, 2013.

Particulars of Contracts or arrangement with related parties referred under Section 188(1):

The Company had not entered into any arrangement/ transaction with related parties which is material in nature and accordingly, the disclosure of Related Party Transactions in Form AOC-2 is not applicable. Transactions entered by the Company with its related parties were on an arm’s length basis and suitable disclosures as required under Ind AS-24 have been made in Note No. 32 to the Financial Statements. In compliance of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company has formulated a Related Party Transactions Policy and the same is available on the Company’s website "www. deccancements.com".

Energy Conservation, Technology Absorption and Foreign Exchange:

Information required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 forming part of the Directors’ Report for the year ended 31st March 2021 are given in Annexure II.

Internal Control Systems and its Adequacy:

The details in respect of internal control and its adequacy are included in the Management Discussion & Analysis, which forms part of this report.

Risk Management:

The Company has framed a Risk Management Policy and details of policy are disclosed in the company’s website "www.deccancements.com".The Risk Management Policy envisages identification of risk and procedures for assessment and mitigation thereof.

Corporate Social Responsibility (CSR):

Pursuant to Section 135 of Companies Act, 2013, your Company has constituted a Corporate Social Responsibility Committee. The composition of the Committee is provided in the Corporate Governance Report. Your Company has formulated a Corporate Social Responsibility Policy, which has been approved by the Board indicating the projects or programs to be undertaken by the Company, in line with Schedule VII of the Act. The same is available on the website of the Company "www.deccancements.com". A brief outline of the CSR policy of the Company and the Annual Report on CSR activities undertaken during the year 2020-21 in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed to this Report (Annexure III).

Board Evaluation:

In compliance of the provisions of the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the annual performance evaluation of individual directors was carried out by the Board.

The detailed criteria in which the performance of the individual directors was carried out has been disclosed in the Corporate Governance Report.

The Performance evaluation of independent directors was done by the entire Board of Directors excluding the director being evaluated.

Particulars of Employees:

The information required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure IV.

During the financial year under review, none of the Company’s employees are in receipt of remuneration more than the limit prescribed under Section 197(12) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Prevention of Sexual Harassment Policy:

The Company has formulated a policy on Prevention of Sexual Harassment at workplace for women in the line with the requirements contribution of the made by the employ ‘The Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013 and the Rules made thereunder.

During the financial year ended 31st March, 2021, the Company has not received any Complaint pertaining to Sexual Harassment.

Impact assessment of the global health pandemic COVID-19 and related estimation uncertainty:

As per the directives of both the Central and State Governments in the wake of COVID-19 pandemic, your Company had suspended operations w.e.f. 23rd March 2020. Taking into account directives from the Government operations have commenced in a phased manner from 20th April 2020.The Company’s operations were impacted in the month of March and April 2020. The Company has made an assessment on measurement of assets and liabilities including recoverability of carrying values of its assets, it liquidity position and ability to repay its debts for the next year, and concluded that no material adjustments are considered necessary. The Company has not availed moratorium allowed by RBI for payment of its debt obligations and the Company continues to service all its payment obligations in time. The Company has adequate liquidity in the form of cash and credit facilities/lines for meeting its funds requirements.

Acknowledgement:

Your Directors place on record their sincere appreciation for significant -ees through their dedication, hard work and commitment. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain amongst the well performing units of the industry.

Your Directors take this opportunity to express their gratitude to Central and State Governments and their departments and the local authorities, the Banks, Dealers, Stockists and Customers for their continued guidance and support to the Company during the year under review.

Your Directors are also grateful to the shareholders for their confidence and faith reposed in the Company.

For and on behalf of the Board
Sd/-
M B Raju
Place: Hyderabad Executive Chairman
Date: 11th June 2021 DIN: 00016652