elgi equipments ltd share price Directors report


Dear Shareholders,

Your Directors hereby present the sixty second Annual Report of Elgi Equipments Limited ("Elgi / the Company") along with the audited financial statements for the year ended March 31, 2022.

Financial Results

The highlights of the standalone performance of your Company during the fiscal are given hereunder:

Particulars 2021 - 22 2020 - 21
Profit before depreciation, exceptional items & tax 2,881.11 1,755.21
Less: Depreciation and amortisation expenses 367.68 353.29
- Exceptional items
Profit Before Tax 2513.43 1,401.92
Less: Income tax expense 619.92 351.02
Net Profit 1,893.51 1,050.90
Add: Opening balance in retained earnings 6,247.48 5,184.71
Less: Dividend paid during the year 253.28
- Transfer to general reserve
Add: Remeasurement of post-employment benefit obligation, net of tax 17.38 9.74
Transfer to retained earnings of gain on FVOCI equity instruments 2.13
Transfer to retained earnings of gain on sale of Treasury shares, net of tax 50.98
Closing balance in P&L account 7,956.07 6,247.48

Review of Business Operations

The Company realised an operating revenue of 15,825.90 Million as against 11,001.70 Million in 2020-21. The details of division wise performance and other operational details are discussed at length in the Management Discussion and Analysis section. There was no change in the nature of business of the Company during the financial year ended March 31, 2022.

Share Capital

During the year under review, there are no changes in the issued and paid-up share capital of the Company. The issued and paid-up share capital of the Company consist of 31,69,09,016 equity shares of face value of 1/- each amounting to 31,69,09,016/- as on the date of the report.

Transfer to reserves

The Company has not transferred any amount to the General Reserve during the year under review. However, an amount of 1,893.51 million of the current profits has been carried forward under the head retained earnings.

Dividend

Pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), the Dividend Distribution Policy of the Company is hosted in the Companys website at https://www.elgi.com/in/wp-content/uploads/2020/02/ Dividend-Policy.pdf.

For the financial year 2021-22, in line with the Dividend Distribution Policy, the Board of Directors at their meeting held on May 13, 2022, has recommended a dividend of 1.15/- per share (115%) on the paid-up share capital of 31,69,09,016 equity shares. Subject to the approval of shareholders, an amount of 364.45 million will be paid as dividend after deducting applicable taxes (Previous Year 253.28 Million).

Transfer of Unclaimed Dividend/Shares to Investor Education and Protection Fund

In terms of Sections 124 and 125 of the Companies Act, 2013, ("Act") unclaimed or unpaid dividend relating to the financial year 2014-15 is due for remittance to the Investor Education and Protection Fund ("IEPF") established by the Central Government.

Further, pursuant to Section 124(6) of the Act, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, 47,316 equity shares of 1/- each on which dividend had remained unclaimed for a period of 7 years have been transferred to the credit of demat account identified by the IEPF Authority during the year under review.

Annual Return

The Annual Return of the Company for the financial year 2021-22 as required under Section 92(3) of the Act is available on the website of the Company and can be accessed on the Companys website at the link "https://www.elgi.com/in/financials/".

Board Meetings held during the year

During the year, five meetings of the Board of Directors were held. The details of the meetings are furnished in the Corporate Governance Report which is attached to this Report.

Committees

As on March 31, 2022, the Company has Audit Committee, Nomination and Remuneration Committee, Compensation Committee, Stakeholders Relationship Committee, Risk Management Committee and Corporate Social Responsibility Committee. Detailed note on the composition of the Board and its Committees are provided in the Corporate Governance Report attached to this Report.

Statement on compliance with Secretarial Standards

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and such systems are adequate and operating effectively.

Directors Responsibility Statement

Pursuant to the requirement under Section 134(3)(c) of the Act, with respect to Directors Responsibility Statement, it is hereby confirmed that:

a. In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards;

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 of the Company for that period;

c. The Directors have taken proper and sufficient care for 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 have prepared the annual accounts 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 had devised proper systems to ensure compliance with the provisions of all the applicable laws and such systems were adequate and operating effectively.

Details in respect of frauds reported by Auditors under Section 143(12) of the Act other than those which are reportable to the Central Government.

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Act.

Declaration of Independent Directors

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Act and SEBI Listing Regulations.

Remuneration policy of the Company

The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for fixing and revising remuneration of Directors, Key Managerial Personnel, Senior Management Personnel and other employees of the Company. The Remuneration policy is annexed herewith as Annexure A to this report. The Remuneration policy of the Company can be accessed on the Companys website at the link https://www.elgi.com/in/wp-content/uploads/2019/05/RemunerationPolicy.pdf.

Comments on Auditors Report

There are no qualifications, reservations or adverse remarks or disclaimers made by Price Waterhouse Chartered Accountants LLP, Statutory Auditors.

Mr. M. D. Selvaraj, MDS & Associates, Secretarial Auditor in his report has stated that in one instance, the Company has not complied with the provisions of Regulation 29 of SEBI Listing Regulations for which the stock exchanges have imposed a fine. The Company has since paid the fines imposed. The management will ensure that there are no such instances going forward.

Particulars of Loans, Guarantees or Investments made under Section 186 of the Act

Details of loans given, investments made, guarantees given and securities provided pursuant to the provisions of Section 186 of the Act have been given in the notes to the Financial Statements.

Particulars of contracts or arrangements with Related Parties

All transactions entered into with related parties as defined under the Act and Regulation 23 of the SEBI Listing Regulations during the financial year 2021-22 were in the ordinary course of business and on an arms length pricing basis.

The particulars of contract or arrangement entered into with related parties referred to in Section 188(1) of the Act which are material in nature are disclosed in the prescribed Form AOC-2 and annexed herewith as Annexure B to this report.

The Audit Committee and the Board of Directors have approved the Related Party Transactions Policy and the same has been hosted on the Companys website at https://www.elgi.com/in/wp-content/uploads/2019/05/ Related-PartyTransactions-Policy.pdf.

The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and related parties.

Material Changes and commitments affecting the financial position of the Company

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year as on March 31, 2022 and the date of this report.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

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

Risk management

Pursuant to the requirement of Regulation 21 of the SEBI Listing Regulations, the Company has constituted a Risk Management Committee ("RMC"), consisting of Board members and senior executives of the Company. The Company has in place a Risk Management framework to identify, evaluate business risks and challenges across the Company both at corporate level as also separately for each subsidiary.

The top 10 risks for the Company have been mapped by the operating management (with additional support of external guidance) after extensive deliberations on the nature of the risk being a gross or a net risk and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/management efforts. Based on this framework, a Risk Management policy has been adopted.

The RMC engages in the Risk Management process and has set out a review process so as to report to the Board the progress on the initiatives for the major risks of each of the businesses that the Company is into. The RMC reviews the top 10 risks. The results of the mitigation measures implemented by the Company are given below:

S.No. Risk Category Risk Summary Risk Response /Mitigation actions/Position
1 Compliance Risks The companys business is subject to legal and regulatory requirements globally; non-compliance could result in severe consequences The Company has improved the compliance process to be more efficient and effective in place of the current intranet based solution. The Company has implemented a professional software tool to monitor compliance on a global basis.
Proof of compliance is either being collected or reported by the compliance owners every quarter end. The status is reported to the Audit committee and Board during their quarterly meetings.
The process of revisiting the checklist for various entities in rotation is being continued. Further, whenever there is a new entity created in a new geography, we engage a law firm to get the compliance list created within the first year of incorporation.
2 Human Resource Risks Recruiting and retaining strong talent is key to achieving the Companys aspirations; any gaps in these efforts could impact the achievement of revenue and profitability targets. The talent acquisition process is getting further strengthened. We have involved global leadership in the new leadership hiring process. We now use outcome based Job Description for all key roles. The competency behaviour model designed by a leading agancy is used in key hiring.
The global functional leadership is actively engaged in key regional hiring.
On the other hand, the Company is also investing well in the Talent development model. The functional head for Organisation development and Talent Management along with Chief Human Resource Officer are driving the talent agenda for the Company. The Company has engaged a leading consultant to help its talent management initiative.
The project titled "Integration of Talent" was kick started in early September 2021. The objective being "grow talent pool for global success".
Besides the Companys continued focus on understanding market compensation, the Company has also made a significant change in the annual compensation revision process. The Company has moved to a decentralized compensation decision mechanism (instead of HR managing this centrally). The businesses and functions have been given autonomy to recommend and decide on compensation increases for their teams, basis broad corporate guidelines.
The intent is to bring ownership in the managers for their people, drive and reward performance. This is also an important enabler to the talent management program, as the Companys managers become more aware and start investing in their human resources at a strategic level.
3 Economic & Market Risks Our global operations are subject to economic and market risks in the geographies we operate in. The pandemic has, over the last 18 months, offered the opportunity to test this dimension. The timing and impact of the pandemic varied across global regions. The Companys geographically diversified presence helped it to deliver decent financial performance. The Company was able to leverage and cross deploy resources to manage shifting demands.
The risk mitigation efforts, supported through serving broad range of industry segments, is serving the company well. As the pandemics effects became widespread, certain sectors had greater demand for compressors. During the second wave, the need for compressors to generate oxygen became a national need and the company served this demand well by prioritizing the requirement in national interest.
4 Growth Risks Acquisitions, joint ventures and investments could be unsuccessful or consume management time and resources, which could adversely affect our operating results The Company has not made any acquisitions during the year. As a standard practice, detailed due diligence is performed with the help of external experts in the legal, financial and tax areas to fully understand and factor the risks in both making a decision on the deals as well as arriving at the acquisition price. Integration is given adequate weightage whenever there is an acquisition and handled sensitively.
5 Strategic Risks Business continuity could be severely affected due to natural disasters or unexpected events like COVID 19 pandemic Insurance policies commensurate with business requirements have been taken by the Company. These policies are periodically reviewed to strengthen the scope as required.
The Company has responded swiftly and effectively by managing its costs and cash flows to largely overcome the sales compression caused by COVID-19. The Company has a disaster management plan in place and continues to refine it regularly to meet the changing requirements.
The Company also managed its sales and operations very effectively during both the Covid waves across different geographies, as a result of which, the impact on the business was minimal.
6 Supply Chain Risks Disruptions in supplies due to concentration of manufacturing facilities in a single location and reliance on one or few suppliers present risks to business stability The Company continues to explore responses to manufacturing concentration including strategic stocking in various parts of India and rest of the world in the short to mid-term and is planning to have assembly operations in global regions in the mid to long-term.
The Company has rolled out a new initiative "Cost Optimisation in Operations" (COSMOS) by engaging an expert consultant. The objective is nearly self-explanatory.
The focus is on optimizing material cost and Other variable costs. As a part of this initiative, the supplier base is being critically reviewed and augmented as required.
The supplier base has been widened gradually and dependence on particular suppliers and geographies is also being reduced. Work on developing a global network of suppliers is a continuous activity.
The Company will continue to carry out strategic, selective backward integration such that manufacture of most critical parts are moved in-house.
The Company hopes to get some vital inputs from project COSMOS.
7 Information Technology Risks Cyber security risks could disrupt the companys technology systems, infrastructure, and networks. Gaps in data protection could result in non-compliance of applicable regulations Reliability is continuously enhanced by adopting and moving critical systems systematically to the Cloud. Up-to-date technology is deployed to ensure that Emails are scanned and quarantined if risks are detected. Multi- factor authentication has been implemented for minimizing cyber risks due to password hacks.
The Company is moving to cloud in a phased manner, and in this connection, has already moved Product Lifecycle Management (PLM) on Amazon Web Services (AWS) during this year FY 2021-22 as the Company upgraded its PLM. Multi-factor authentication has been implemented, including for Virtual Private Network (VPN) to minimizing cyber risks due to password hacks.
The Company is evaluating implementation of EDR (End Point Detection and Response system) in a phased manner. Security Information and Event Management (SIEM) solution implementation has begun and is being systematically extended to all critical on-premise platforms.
PAM (Privileged Access Management) for exerting control over the elevated access and permissions for users, accounts, processes, and systems across an IT environment are also being implemented. The Company has planned to pursue ISO 27001 certification also.
IT security audits are performed annually to assess the vulnerabilities in the existing systems. The Company is exploring the possibility to move to half-yearly audit besides deploying intelligent security monitoring tools. Global Data privacy policy to comply with General Data Protection Requirements (GDPR) of Europe and other applicable privacy laws in various jurisdictions is also in the pipeline.
The Company is moving into Quarterly Vulnerability Assessment and Penetration Testing (VAPT) audit. After a VAPT review in June21, another review is currently in progress
8 Financial Risks Exchange rate fluctuations in the various currencies that company deals in could adversely affect the companys financial performance To minimize fluctuation risks, the Company has a strong hedging process and has a policy in place, besides leveraging the natural hedge that is available. The Company also continuously monitors the exchange rates relevant for its geographies and takes suitable actions to offset adverse changes by adjusting selling prices and costs.
During the year, the Company has not had any major impact. The Company continues to work with its bankers to understand the regulatory changes in the banking system with reference to managing exchange risks and leverage them suitably.
This is a continuous process and our good relationship with the financing banks help us get timely advice on this front.
9 Environmental Risks Global climate change and related regulations can negatively impact our business The Company will focus more on Electric Powered Screw Air Compressors (EPSAC) and Oil Free Screw Air Compressors (OFSAC) for its future growth, gradually reducing the dependence on Diesel Powered Screw Air Compressors (DPSAC) in its overall portfolio. Environmental factors and regulatory changes taking place globally are closely monitored to effect appropriate actions to align the Companys products with these requirements.
The Company is embarking on a major Environmental, Social & Governance (ESG) initiative, not only to satisfy regulatory requirements that come into force from FY 2022-23 but also as a sincere corporate citizen looking to contribute to a better environment for all. In this connection, the company will focus on the "E" portion of ESG more emphatically. We have formed a team of cross functional leaders with passion for ESG who have started work on this. We are engaging with a leading consultant partner to help us in this journey.
The Companys operations are constantly upgraded to adopt green manufacturing practices.
10 Strategic Risks The Companys large dependence on India makes it susceptible to the economic fortunes of a single geography The Company believes that the revenue mix is now well spread across geographies so as to reduce dependence on India.
The Companys strategic plan for the mid-term and the strategic initiatives are aligned to this goal to diversify the revenue mix.

Corporate Social Responsibility Initiatives

The brief outline of the Corporate Social Responsibility ("CSR") Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out as Annexure D to this report in the format prescribed in the Companies (CSR Policy) Rules, 2014. For other details regarding the CSR Committee, refer to the Corporate Governance Report, which is a part of this report. The policy is available on the website of the Company.

Performance Evaluation of the Board, it Committees and the Directors

Pursuant to the provisions of the Act and SEBI Listing Regulations, the Board of Directors has carried out annual performance evaluation of its own performance, the Directors Individually as well as the evaluation of the working of its Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report attached as an Annexure to this report.

Statement regarding opinion of the Board with regard to integrity, expertise and experience (including the proficiency) of the Independent Directors

The Board of Directors have evaluated the Independent Directors during the year 2021-22 and opined that the integrity, expertise and experience (including proficiency) of the Independent Directors is satisfactory.

Directors and Key Managerial Personnel

Dr. T Balaji Naidu, Director retired from the Company on January 21, 2022. Mr. Anvar Jay Varadaraj was appointed as an Executive Director of the Company with effect from August 2, 2021 subject to the approval of the Central Government. During the year under review, the Company has received the approval of the Central Government for the said appointment. Mr. Sudarsan Varadaraj, Director retires by rotation at the ensuing AGM and being eligible, offers himself for re-appointment. Your Directors recommend his re-appointment.

The resolutions seeking approval of the Members for the re-appointment of Mr. Sudarsan Varadaraj as Director have been incorporated in the Notice to the AGM of the Company along with brief details about him.

Mr. Ragunathan K resigned as the Company Secretary and Compliance Officer of the Company with effect from August 2, 2021. Mr. S Prakash was appointed as the Company Secretary and Compliance Officer of the Company with effect from August 3, 2021.

Pursuant to the provisions of Section 2(51) and 203 of the Act, the Key Managerial Personnel of the Company are Mr. Jairam Varadaraj, Managing Director, Mr. Jayakanthan R, Chief Financial Officer and Mr. S Prakash, Company Secretary.

Subsidiaries, Joint Ventures and Associate Companies

The highlights of performance of subsidiaries, associates and joint venture companies and their contribution to the overall performance of the company during the period review have been disclosed in the Management Discussion and Analysis Report.

The Company has 25 subsidiaries and 8 joint ventures/ associate entities. The statement pursuant to Section 129(3) of the Act, containing the salient features of the financial statements of subsidiary Companies, in Form AOC-1 forms part of this Annual report. Elgi Compressors (M) SDN. BHD, Malaysia a wholly owned subsidiary of the Company was incorporated during the year. During the year under review, Gentex Air Solutions LLC, USA, a joint venture company was formed. Elgi Equipments (Zhejiang) Limited was closed during the year.

Elgi Compressors USA Inc., Elgi Compressors Europe S.R.L, Rotair SPA and Pattons Inc. are the material subsidiaries of the Company based on the financials for the year ended March 31, 2022. The Board has approved a policy for determining material subsidiaries, which has been uploaded on the Companys website viz. www.elgi.com. The consolidated financial statements of the Company and its subsidiaries prepared in accordance with the applicable accounting standards have been annexed to the Annual Report. The annual accounts of the subsidiary companies are hosted on the website of the Company viz. www.elgi.com and will also be kept open for inspection by the shareholders at the registered office of the Company. The Company will also provide a copy of the annual accounts of subsidiary companies to the shareholders upon their request.

Deposits

Your Company has not accepted any deposit within the meaning of provisions of Chapter V of the Act, read with the Companies (Acceptance of Deposits) Rules, 2014 for the year ended March 31, 2022.

Details of significant and material orders passed by the Regulators or Courts or Tribunals

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companys operations in future.

Internal Control Systems and their Adequacy

The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditors report, key issues, significant processes and accounting policies. The Directors confirm that the Internal Financial Controls are adequate with respect to the operations of the Company. A report of Auditors pursuant to Section 143(3) (i) of the Act certifying the adequacy of Internal Financial Controls is annexed with the Auditors Report.

Statutory Auditors

Price Waterhouse Chartered Accountants, LLP (FRN 012754N/N500016) Chartered Accountants, Chennai were appointed as the Statutory Auditors of the Company for a period of five years at the fifty seventh AGM of the Company held on July 28, 2017. The Audit Committee and the Board has approved the re-appointment of Price Waterhouse Chartered Accountants, LLP for the second term of five (5) years i.e., from the conclusion of the sixty second AGM till the conclusion of the sixty seventh AGM. The necessary resolution seeking approval of the Members for their re-appointment has been incorporated in the Notice to the AGM of the Company along with brief details about them.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed MDS & Associates, Company Secretaries in Practice, Coimbatore to undertake the secretarial audit of the Company. The report of the secretarial auditor is attached as Annexure E. As per Regulation 24 A of the SEBI Listing Regulations, the Company carried out Secretarial Audit of its material unlisted subsidiary ATS Elgi Limited also through MDS & Associates, Company Secretaries in Practice. The report of the Secretarial Audit of ATS Elgi Limited is annexed.

Cost Auditors

Pursuant to the provisions of Section 148(3) of the Act, the Board of Directors had appointed STR & Associates, Cost Accountants, Trichy (Firm Registration No.: 000029), as Cost Auditors of the Company, for conducting the audit of cost records for the financial year ended March 31, 2022. The audit is in progress and report will be filed with the Ministry of Corporate Affairs within the prescribed period. A proposal for ratification of remuneration of the Cost Auditors for the financial year 2022-23 is placed before the shareholders for ratification/ approval.

The cost records as specified by the Central Government under sub-section (1) of Section 148 of the Act, as required by the Company is maintained by the Company.

Details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the year

No applications have been made and no proceedings are pending against the Company under the Insolvency and Bankruptcy Code, 2016.

Details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

The disclosure under this clause is not applicable as the Company has not undertaken any one-time settlement with the banks or financial institutions.

Human Resources and Industrial Relations

The Company continues to enjoy cordial relationship with its employees at all levels. The total strength of employees as on March 31, 2022 was 2,162 (including subsidiaries).

Particulars of Employees

In terms of the provisions of Section 197(12) of the Act, read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names of the top ten employees in terms of remuneration drawn and names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules forms part of this Report as Annexure F. Disclosures relating to remuneration and other details as required under Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report.

Having regard to the provisions of the second proviso to Section 136(1) of the Act and as advised, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such information may address their email to investor@elgi.com.

Elgi Equipments Limited Employee Stock Option Plan, 2019

The Company has implemented the Elgi Equipments Limited Employee Stock Option Plan 2019 to enable the Company and its subsidiaries to attract, retain and reward appropriate human talent in its employment and to create a sense of ownership and participation amongst the employees. The Compensation Committee administers and monitors the Employees Stock Option Plan of the Company through the Elgi Equipments Limited Employee Stock Option Trust. The Compensation Committee has during the year under review issued 4,74,300 options at a grant price of 225/- per option to the eligible employees of the Company. No options were granted to the Directors. The disclosure pursuant to the provisions of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 is given as Annexure G to this report.

The Company has received a Certificate from the Secretarial Auditors that the above referred Scheme had been implemented in accordance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and the resolutions passed by the members in this regard.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder, your Company has constituted an Internal Complaints

Committee. During the year under review, there were no cases received/filed pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Business Responsibility Report

Pursuant to Regulation 34 of SEBI Listing Regulations, read with SEBI Circular No. CIR/CFD/CMD/10/2015 dated November 4, 2015. The business responsibility report is annexed as Annexure H to this report.

Corporate Governance

A report on corporate governance is annexed to and forms part of this report. The Company has complied with the conditions relating to corporate governance as stipulated in SEBI Listing Regulations.

Vigil Mechanism/Whistle Blower Policy

Pursuant to the provisions of Section 177(9) of the Act, read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulations 4 and 22 of the SEBI Listing Regulations and in accordance with the requirements of SEBI (Prohibition of Insider Trading) Regulations, 2015, the Company has a Whistle Blower policy to deal with unethical or improper practice or violation of Companys Code of Business Conduct or any complaints regarding accounting, auditing, internal controls or disclosure practices of the Company. This Policy inter-alia provides a direct access to the Chairman of the Audit Committee. Your Company hereby affirms that no Director/employee has been denied access to the Chairman of the Audit Committee. Brief details about the policy are provided in the Corporate Governance Report attached to this Report. The Audit Committee of the Board reviews the Complaints received, redressed, objected, withdrawn and dismissed for, every quarter in their meeting. During the year, there were no complaints under this policy. The Whistle Blower policy is available on the website of the Company at the following address https://www.elgi.com/ in/wp-content/uploads/2019/10/Whistle-Blower-Policy.pdf.

Acknowledgement

Your Directors thank the shareholders, customers, suppliers, bankers and all other stakeholders for their continued support during the year. Your Directors also place on record their appreciation of the contributions made by employees at all levels towards the growth of the Company.

For and on behalf of the Board
Jairam Varadaraj N. Mohan Nambiar
Place : Coimbatore Managing Director Director
Date : May 13, 2022 DIN: 00003361 DIN: 00003660