Empire Industries Ltd Management Discussions.

The Directors hereby present their Annual Report together with the Audited Accounts of the Company for the year ended March 31, 2021.

1. FINANCIAL RESULTS:

Particulars Year ended 31.03.2021 Year ended 31.03.2020
Amt. in Lakh Amt. in Lakh
Income:
Revenue from Operations 49026.13 57475.87
Other Income 2333.13 1855.42
Total Revenue 51359.26 59331.29
Expenditure
Cost of Materials Consumed 14203.82 18201.13
Cost of Project 2042.03 1316.40
Purchase of Stock-in-Trade 4648.19 12918.14
Changes in Inventories of Finished goods and Stock-in-Trade 4157.75 (3913.78)
Employee Benefit Expenses 9276.32 10454.09
Finance Costs 3484.83 3158.46
Depreciation and Amortization Expenses 1904.53 1498.44
Other Expenses 10372.17 11046.58
Total Expenses 50089.64 54679.46
Profit/(Loss) before exceptional and tax 1269.62 4651.83
Exceptional items - 628.44
Profit / (Loss) before tax 1269.62 4023.39
Tax Expenses
(1)Current Tax 65.42 476.72
(2)Deferred Tax (116.59) 129.04
(51.17) 605.76
Profit after tax 1320.79 3417.63
Other comprehensive income
Items that will not be reclassified 12.22 (10.67)
to profit or loss
Total comprehensive income for the period 1333.01 3406.96
Appropriated as under:
Proposed Dividend 411.69 1500.00
Tax on Dividend - 308.33
General Reserve 921.32 1598.63
Total amount appropriated 1333.01 3406.96
Earnings per equity share (for discontinued & continuing operations).
a)Basic 22.01 56.96
b)Diluted 22.01 56.96

2. DIVIDEND:

Your Directors are pleased to recommend a Dividend of Rs. 25/-per equity share of face value of Rs.10/- each for the year ended 31 March, 2021 subject to the approval of the Members at the Annual General Meeting on 29 September, 2021.This will be paid on or after 29 September, 2021 to the Members whose names appear in the Register of Members, as on the Record Date i.e. Tuesday, 21 September 2021. The total dividend for the financial year will absorb Rs. 411.69 Lakh (Previous Year Rs. 1500 Lakh) as the promoters along with their relatives and associates have given their consent to forego their rights to claim dividend, if any, recommended by the members of the Board and approved in the General Meeting. The tax on distributed profits, shall be payable by the members.

3. OPERATIONS:

The Division-wise details are given below:

i. VITRUM GLASS

Vitrum Glass is an acknowledged leader in the manufacture and marketing of high quality amber glass bottles for the pharmaceutical industry- both for India and abroad.

The divisions fully automated plant produces more than 1.8 million glass bottles a day with sizes ranging from 5ml to 650ml.

The plant is located at Vikhroli, Mumbai. It boasts of a clientele of the best multinational pharmaceutical companies in India such as GlaxoSmithKline, Pfizer Limited, Merck Limited, Wardex Pharmaceuticals and Cipla Limited, among others.

Despite the COVID-19 lockdown, the division achieved a total turnover of Rs. 144.67 crores. Out of the total turnover, exports were Rs 27.78 crores.

There was an overall increase in profitability and this trend is expected to continue in the current year.

ii. EMPIRE MACHINE TOOLS - MCAT

(Metal Cutting & Allied Technologies)

This division has been badly affected by the COVID-19 pandemic along with the Government of Indias announcement regarding a ban on Global Tenders with effect from 15/05/2019.

Order booking and shipment were badly affected due to the slowdown in economic activity and a general restriction on movements.

Pending order backlog is good which will ensure that the year 2021-2022 is profitable.

The future depends on the relaxation of Government policies and the demand outlook.

The current focus is on private sector clients who seem to have a limited capacity for high value equipment.

Many cost cutting efforts are being done to minimize losses.

Moving forward, the division expects business from the following sectors : Windmill Equipment Subcontractors, Nuclear Power Generation equipment manufacturers, Railways, Defense, Aerospace & Automobile including E-Vehicles.

iii. EMPIRE INDUSTRIAL EQUIPMENT

Empire industrial Equipment is in the business of sourcing capital equipment and undertaking related turn key jobs for the infrastructure sector like oil and gas, steel and metallurgy, ports and shipyards and construction and mining.

These services include local supply chain management, inland transportation, site management including civil foundation, electrical cabling and erection & commissioning.

In the context of "Atmanirbhar" policies that have become dominant in the Indian scenario, the division has been able to offer Indianised additions to the imports as required by the government directives.

It has largely achieved this by identifying competent Indian companies who undertake part work in India including packaging and marrying them with principals abroad who together offer solutions to the Indian industry.

The divisions role is mainly to facilitate this operation and to market these packages successfully.

During the year under review, due to COVID 19, the divisions sales plummeted. However costs were drastically kept down.

Many projects got delayed. The poor situation exasperated due to newly introduced governmental regulations which restricted imports to a great extent.

This aspect has now changed with the government relaxing most of the rules for the oil and gas sector. The steel and metallurgy sector still continues to be low on the investment front.

"Ports and shipyards" & construction and mining segment investments have been projected reasonably well for year 2021-22.

The division hopes to do well in the year 2021-22, despite the continuing pandemic.

iv. EMPIRE VENDING (GRABBIT )

Empire industries gifted a new avenue to the Indian retail industry by founding Grabbit Premium vending Services in the year 2006. Grabbit officially became the first entity to create a market for vending machines in India. It re-launched as Grabbit + in the year 2014. It is a leader of vending in India. It has grown enormously over a decade and has vending machines installed across all major metro cities of India.

The year 2020 started innocuously enough, but soon took the shape of a disaster of epic proportions. What started as an epidemic in Wuhan, China, grew into a global pandemic and changed our lives forever. The era of contactless exchanges had now become essential to our very survival. Grabbit+ launched several different machines to support the fight against COVID 19.

It launched completely touch less machines to PPE & sanitizer dispenser machines. Its entire operations were modified as per the prevention of covid-19 guidelines.

Grabbit+ also launched its own range of sanitizers that started gaining popularity in corporates, housing societies and other niche market segments.

Innovation remains the hallmark of Grabbits operations, which are driven by its passion for bringing quality and trendsetting vending services to its esteemed clients.

Having introduced some of the best-in-class vending machines, including the Crane Media Vending Machine, it has presented yet another revolutionary concept that seeks to transform vending services in the Indian industry, and bring an unseen level of convenience in retail - Grabbit CAFE - A Complete Automated Solution.

Conceptualized and designed by Grabbit , CAFE is a smart blend of hi-tech vending machines from Crane merchandising systems, USA and Necta, Italy. It is an innovative vending solution presenting a combination of leading global technology and aesthetic appeal, exclusively designed to enhance the appearance of the cafe area in your work place.

Along with the corporate market, Grabbit+ has diversified into new market segments like housing societies and hostels that are gaining popularity.

It is its constant endeavor to identify new ways of offering better value to its customers while maintaining consistency in the quality of its existing products and services.

Simultaneously, the division continues to augment its repertoire of products and enhance its overall network.

v. EMPIRE FOODS

The Empire foods division imports various types of frozen food from all over the world and sells to leading hotels, restaurants and caterers in the country.

The year under review was challenging for the hospitality sector because hotels & restaurants were closed for most of the year. The markets had started to reopen from January 2021 onwards but the lockdown following the second wave brought back lots of restrictions in the Hospitality sector.

Under these circumstances, the division explored the retail markets to increase sales.

During the current year as the vaccination process is going on, the division hopes that the Hospitality sector will reopen soon and business will restart at previous levels.

It also plans to further develop its business in Retail chains across the country.

vi. EMPIRE REAL ESTATE

This division manages Empire Industries Ltd.s owned properties comprising 10 lakh Sq. Ft of Commercial and IT space. It boasts of an excellent clientele such as, HDFC Bank, Zee Entertainment, ICICI Bank, CNBCTV18, TUL and others.

Its IT Park at Vikhroli, Mumbai, consists of 2 buildings - Empire Plaza 1 and Empire Plaza 2. Both buildings are 100% occupied. Its Commercial space at Empire Complex located in Lower Parel, Mumbai, is currently 50% occupied.

Empire Industrial Centrum

The Empire Industrial Centrum is being developed on a 35-Acre property in Ambernath. The project started in the year 2014 -2015 after obtaining all the necessary Government Approvals.

The division has registered its project with RERA for Phase-1-

4. Out of which it delivered Phase-1 after receiving occupation certificates from MIDC for all the 5 buildings (3 residential and 2 industrial buildings).

Phase-2 comprises of 1 residential building that is near completion. Phase-3 comprised of 2 residential buildings. Phase-4 comprises of 1 Industrial building that is under construction.

Accolades received by the Company in FY 21 from Real Estate & Infrastructure Icons 2020 were " Iconic Industrial Spaces for MSMEs - MMR " and "Iconic World Class Amenities Beyond Thane" reflecting its commitment towards being amongst the best real estate companies.

The current financial year turned productive for this division as there is an upcoming railway station adjacent to the plot that would be huge value addition to customers.

As the said property is being developed in phases, this development will strengthen the Companys performance in the coming years and create strong and enduring value for all its stakeholders.

The Empire Business Centre (TEBC)

The Empire Business Centre offers fully furnished and built to suit serviced office spaces in Mumbai, India.

The Empire Business Centre (TEBC) is known for its high level of customer satisfaction, loyalty and well-appointed contemporary office interiors.

They have had and continue to enjoy the patronage of multinationals, SMEs and growing organizations including self-employed professionals.

The products on offer include office space, virtual offices, meeting rooms and lounge / co-working spaces.

TEBC has seen a high level of client renewals and repeat clients. The centres command the best prices in their market segments.

Apart from its clients, the division enjoys excellent rapport with the broker fraternity both international and local.

It has also augmented its digital presence to serve the online customer.

4. CAPITAL EXPENDITURE

The major Capital Expenditure is on account of Plant & Machinery (Rs. 428.12 Lakh), Capital Work-in-Progress (Rs. 817.11 Lakh), Vehicles (Rs. 45.92 Lakh), Office Equipment (Rs. 76.47 Lakh), Furniture & fixtures (Rs. 14.97 Lakh) and Software (Rs. 29.04 Lakh).

5. EXTRACT OF THE ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed to this report as Annexure -A.The Annual Return of the Company has been placed on the website of the Company and can be accessed at http://www.empiremumbai.com/AnnualReport.zip.

6. NUMBER OF MEETINGS OF THE BOARD

During the year Four Board Meetings and Four Audit Committee Meetings were convened and held. The details of Board and Committee meetings are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

7. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that :

(a) in the preparation of the annual accounts for the year ended

March 31, 2021, the applicable accounting standards had been followed along with proper explanation relating to material departures.

(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 as at March 31, 2021 and of the profit and loss of the company for that period;

(c) the directors had taken proper and sufficient care for the

maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

(d) the directors had prepared the annual accounts 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.

"Internal Financial Controls" means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including the adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

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

8. STATEMENT ON DECLARATION GIVEN BY

INDEPENDENT DIRECTORS

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he / she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of the Listing Regulations.

9. COMPANYS POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under sub-section (3) of section 178 relating to the remuneration for the Directors, key managerial personnel, and other employees. As required by the rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the prescribed details are annexed to this report.

10. EXPLANATIONS OR COMMENTS BY THE BOARD ON EVERY QUALIFICATION, RESERVATION OR ADVERSE REMARK

There is no qualification, reservation or adverse remark or disclaimer made

(i) by the auditor in his report; and

(ii) by the Company Secretary in practice in her secretarial audit report.

11. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT

There are no loans given, guarantees issued or investments made to which provisions of Section 186 are applicable to the Company.

12. CORPORATE GOVERNANCE

As per Regulation 34(3) and 53(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Listing Agreement with the Stock Exchange, a separate section on corporate governance practices followed by the Company, together with a certificate from the Companys Auditor/Practising Company Secretary confirming compliance forms an integral part of this Report.

SECRETARIAL STANDARDS:

The Institute of Company Secretaries of India has mandated compliance with the Secretarial Standards on Board Meetings and General Meetings. During the year under review, the Company has complied with the applicable Secretarial Standards.

13. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year were on an arm’s length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons who may have a potential conflict with the interest of the Company at large. All Related Party Transactions are placed before the Audit Committee, which has been reviewed by it and approved by the Board. Prior omnibus approval of the Audit Committee is obtained on an annual basis for the transactions which are of a foreseen and repetitive nature and also been done at arm’s length basis. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company. The report of the Board in respect of the particulars of contracts or arrangements with related parties referred to sub-section (1) of section 188 in Form AOC-2 is annexed to this report.

14. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information pursuant to Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, relating to the foregoing matters is given in the Annexure - B forming part of this report.

15. REPORT ON RISK MANAGEMENT POLICY

The Risk Management Committee with its members as Mr. Dileep Malhotra, Mr. Rajbir Singh and Mr. C. P. Shah performs its activities according to the Risk Policy finalized by the Board indicating the development and implementation of Risk Management.

16. CORPORATE SOCIAL RESPONSIBILITY (CSR)

INITIATIVES

The Company has developed and implemented the CSR policy to carry out activities in health and education and also formed KARO Trust which has been registered on 12.03.2015 with Charity Commissioner, Mumbai for this purpose. The policy is put up on Companys website. CSR report as per the provision of section 135 of the Companies Act, 2013 is annexed to this reportas

Annexure -C.

17. ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013 and the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and compliance committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

18. BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report (BRR) of your Company for the year 2020-21 forms part of this Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

19. TRANSFER OF SHARES/UNPAID/UNCLAIMED AMOUNTS TO IEPF

Pursuant to the provisions of Section 125 of Companies Act, 2013 the Unclaimed Dividend, Fixed Deposits and interest thereon which remained unpaid/unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government pursuant to Section 125 of the Companies Act, 2013.

As per provisions of Section 125(6) of the Companies Act, 2013 read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the Rules") notified by the Ministry of Corporate Affairs effective from September 7, 2016, the Company is required to transfer all shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more in the name of Investor Education and Protection Fund (IEPF) Suspense Account established by the Central Government. Accordingly, the Company has transferred shares to IEPF Authority.

20. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the website of the Company.

21. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (Act) and Rules made thereunder, the Company has constituted Internal Committees (IC). While maintaining the highest governance norms, the Company has appointed external independent persons, who have done work in this area and have requisite experience in handling such matters. During the year, no complaint with allegations of sexual harassment was received by the Company. In order to build awareness in this area, the Company has been conducting programmes in the organisation on a continuous basis.

22. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to this report marked as Annexure -D.

The statement containing names of top ten employees in terms of remuneration drawnand the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the Members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection and Any Member interested in obtaining a copy of thesame may write to the Company Secretary.

23. SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mrs. Deepa Gupta, Practicing Company Secretary, to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed to this report.

24. DIRECTORS

In accordance with the provisions of the Companies Act, 2013, and the Articles of Association of the Company, Mr. Dileep Malhotra, having Director Identification Number 00027168, retire by rotation at this Annual General Meeting and being eligible offer himself for re-appointment.

Mr. Rajbir Singh (DIN : 00826402), Independent Non-Executive Director of the Company, whose term expires at this Annual General Meeting, and has given his consent for re-appointment as an Independent Non-Executive Director of the Company to hold office for second term of five consecutive years with effect from the conclusion of 120 Annual General Meeting to the conclusion of 125 Annual General Meeting of the Company.

25. SUBSIDIARIES, JOINT VENTURE OR ASSOCIATE COMPANIES

There are no companies which have become or ceased to be its subsidiaries, joint ventures or associate companies during the year.

26. DETAILS RELATING TO FIXED DEPOSITS

The details relating to deposits covered under Chapter V of the Act

(a) Accepted during the year : Rs. 1571.95 Lakh.

(b) Remained unpaid or unclaimed as at the end of the year :

< . 442.60 Lakh.

(c) Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

(i) At the beginning of the year : Nil

(ii) Maximum during the year : Nil

(iii) At the end of the year : Nil

Deposits received from Directors amounting to Rs. 882.00 Lakhs, which are exempted borrowings and not covered under sections 73 to 76 of the Companies Act, 2013 as amended from time to time.

27. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

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.

28. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL CONTROLS

The Company conducts its business with integrity and high standards of ethical behavior and in compliance with the laws and regulations that govern its business. The Company has a well-established framework of internal controls in operation, supported by standard operating procedures, policies and guidelines, including suitable monitoring procedures and self-assessment exercises. In addition to external audit, the financial and operating controls of the Company at various locations are reviewed by the Audit Committee of the Board. The Audit Committee reviews the adequacy and effectiveness of the implementation of audit recommendations including those relating to strengthening Companys management policies and systems.

As required by the Companies Act 2013, the Company has implemented an Internal Financial Control (IFC) Framework. Section 134(5)(e) requires the Directors to make an assertion in the Directors Responsibility Statement that the Company has laid down internal financial controls, which are in existence, adequate and operate effectively. Under Section 177(4)(vii), the Audit Committee evaluates the internal financial controls and makes a representation to the Board. The purpose of the IFC is to ensure that policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business are implemented, including policies for and the safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information.

29. ACKNOWLEDGEMENT

Your Directors would like to express their gratitude for the abundant assistance and co-operation received by the Company from its workers, staff, officers, Consortium Banks, members and other Government Bodies during the year under review.

30. AUDITORS

M/s. A. T. Jain & Co., Chartered Accountants (Firm Registration No.103886W) were appointed as Statutory Auditors of the Company at the Annual General Meeting held on 27 July, 2017 for a term of five consecutive years. As per the provisions of Section 139 of the Companies Act, 2013, the appointment of Auditors is required to be ratified by Members at every Annual General Meeting.

31. COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its Construction activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s. Vinay Mulay & Co. to audit the cost accounts of the Company for the financial year 2021-2022 on a remuneration of Rs. 1,50,000/-. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Members ratification for the remuneration payable to M/s. Vinay Mulay & Co., Cost Auditors is included at Item No. 6 of the Notice convening the Annual General Meeting.

On Behalf of the Board of Directors

S. C. MALHOTRA
Place : Mumbai Chairman
Date : June 23, 2021 _ DIN: 00026704