Globus Spirits Ltd Directors Report.

To the Members

Your Board of Directors are pleased to present the Twenty-eighth Annual Report and Audited Accounts for the year ended 31st March, 2021.

FINANCIAL PERFORMANCE

Particulars

Current Year (2020-21)

Previous Year (2019-20)

Standalone Consolidated

Standalone Consolidated

Total Revenue 166077.33 167869.01 125933.44 127116.77
Total Expenses 145752.12 147691.72 118282.05 120426.57
Profit before 21078.69 20177.29 7651.39 6690.20
Exceptional items & Tax
Less: Provision for 6095.31 6095.31 1720.18 1720.08
taxation including
Deferred tax
Profit/ (Loss) after tax 11825.64 14081.98 5931.21 4970.12
Basic EPS 41.06 48.90 20.60 17.33
Diluted EPS 41.06 48.90 20.60 17.33

PERFORMANCE OVERVIEW

During the year under review the company reported a growth of

32% in revenue as compare to previous year and PBT has been increased by Rs.134.27crores from the previous year and also PAT has been increased by Rs.58.94 crores from the previous year. The Basic and Diluted EPS of the Company is Rs.41.06/- as compared to Rs.20.60/- in the previous year.

THE YEAR IN PERSPECTIVE

The fiscal 2020-21 was characterised as a challenging and unprecedented year for most industries. Despite the COVID-19 pandemic, your company has been able to face this challenge head-on and have been able to deliver a robust performance.

In FY20-21, your Company reported a growth of 5.3% in net revenues to reach Rs.1,231 crore and 103% growth in EBITDA to reach Rs.261 Crores with operating margin of 21%. Net profit grew from Rs.50crores in FY19-20 to Rs.141 Crores in the year under review. Profitability improved significantly on the back of higher share of Consumer Business driven by volume and value growth and higher realizations in manufacturing business.

The share of consumer business grew to 43% in FY20-21 from 35% in FY19-20. The consumer business comprising value segment grew by 24% during the year. The Companys key markets like Rajasthan state performed well with the introduction of Medium Liquor segment which got a good response and performance; The Haryana market improved in the past fiscal on the back of Governments support to eradicate the illicit liquor market, whereas the West Bengal market had few COVID-19 related headwinds and is recovering. Our markets share improved both in Rajasthan to almost 29% and in Haryana 10% during the year under review.

Your Company has been working on building a strong portfolio of premium segment brands under the Unibev umbrella currently with 3 brands spread across 10 states, our volumes in premium segment de-grew by around 14% in primary, the secondary performance witnessed a de-growth of 11%.

DIVIDEND

Your Directors are pleased to recommend dividend of Re. 2/-, i.e. 20% per equity share of the company for the year 2020-21.

PUBLIC DEPOSITS

The Company has not accepted or invited deposits covered under the provisions of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposit) Rules 2014 from any person during the year under Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year Mr. Richard Piliero, have resigned from the Board of Directors of the company w.e.f. 08th February 2020. The Directors place on record his appreciation of the valuable contribution made by him.

Mr. Shekhar Swarup, Joint Managing Director of the company, retire by rotation and being eligible offer himself for re-appointment. The Board recommends his re-appointment.

SUBSIDIARY COMPANIES

Your Company has one subsidiary viz., M/s Unibev Limited (formerly known as M/s Uber Blenders & Distillers Limited) (Indian subsidiary).

In terms of proviso to sub section (3) of Section 129 of the Act, the salient features of the financial statement of the subsidiary is set out in the prescribed form AOC-1, which forms part of the annual report.

CORPORATE GOVERNANCE

As per requirement of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Compliance Report on Corporate Governance has been annexed as part of the Annual Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR Policy of the Company and the details about the initiatives taken by the Company on CSR during the year as per the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been disclosed in Annexure-II to this Report. Further details of composition of the Corporate Social Responsibility Committee and other details are provided the Corporate Governance Report which forms part of this report. The policy on Corporate Social Responsibility as approved by the Board of Directors is available on the website of the Company www. globusspirits.com.

NOMINATION AND REMUNERATION POLICY

The Nomination & Remuneration Policy as approved by the Board on recommendation of the Nomination & Remuneration Committee is available on website of the Company www. globusspirits.com.

AUDITORS

The Company, in terms of Section 139 (1) and (2) of the Act 2013, have appointed M/s Deloitte Haskins & Sells, Firm Regn

No. 015125N, Chartered Accountants, having their office at 7th Floor, Building 10, DLF Cyber City Complex, DLF City Phase-II, Gurgaon-122002, Haryana as statutory auditors for 03rd term of their remaining four years vide AGM dated 24th September 2021.

AUDITORS REPORT

The notes on accounts appearing in the schedule and referred to in the Auditors Report are self-explanatory and therefore do not call for any further comments or explanations. There are no adverse remarks/qualifications in the auditors report.

COST AUDIT

The board subject to the approval of the Central Government, if required, has appointed M/s JSN & Co., Cost Accountants, having Firms registration no. 455, its office at 462/1, 1st Floor, Old MB Road, Lado Sarai, New Delhi-110030, as Cost Auditor for conducting the Cost Audit for the financial year 2021-22. The audit committee recommended his appointment and remuneration. The Company has also received necessary certificate under Section 141 of the Act 2013 conveying his eligibility for re-appointment. The remuneration fixed by the board, based on the recommendation of the audit committee is required to be ratified by the members at the AGM as per the requirement of Section 148(3) of the Act 2013.

SECRETARIAL AUDIT REPORT

Secretarial Audit Report has been annexed herewith & forms part of the Annual Report.

PARTICULARS OF EMPLOYEES

Statement pursuant to u/s 197 (12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the particulars of top ten employees are as follows :-

Particulars of Top Ten Employees:

Name Designation Nature of Employment Age Date of Joining Qualifications & Experience Previous Employment %age of Equity shares held Gross Re- muneration
Ajay Kumar Swarup Managing Director Permanent 62 16-Jan-1993 PGDBM (37 years of experience) M/s SVP Industries Ltd. 6.68% 24101563
Shekhar Swarup Joint Managing Director Permanent 35 27-Oct-2008 Degree in Business & Management (13 years of experience) N.A. 2.60% 21015625
Bhaskar Roy Executive Director & COO Permanent 59 04-Oct-2005 Mcom, FCA, PHD (32 years of experience) M/s Saraya Industries Limited 0.00% 9091515
R.K. Malik President (Operation- North) Permanent 64 15/Aug/2000 MBA (43 years of experience) M/s Golden Bottling 0.00% 6000000
Manik Lal Dutta Executive Director Permanent 75 01-Aug-2006 M.Tech, PGDBM (47 years of experience) M/s United Spirits Limited 0.00% 5976264
Jasbeer Singh Vice President – Exports Permanent 63 01-Oct-2014 BSc., MBA(over 20 years of experience) N.A. 0.00% 4615090
Amitabh Singh Vice President Permanent 54 16-Apr-2013 B.Sc. Engineering (30 years of experience) M/s Radico Khaitan Limited 0.00% 3800002
Pankaj Tyagi Vice President Permanent 47 14-May-2015 B.Sc. Engineering (23 years of experience) M/s Brahamaputra Biochem Pvt. Ltd. 0.00% 4307424
Prashant K. Singh Sr. Vice President Permanent 59 19-Oct-2020 B.Sc. Engineering, PGD in Sugar Engineering (34 years of experience) M/s Simbhaoli Sugar Pvt. Ltd. 0.00% 1750000

Notes:

1. The percentage of equity share holding mentioned as above is as on 31st March 2021.

2. None of the Directors or employees are inter related to each other except Sh. Ajay K. Swarup, Managing Director of the company is the father of Sh. Shekhar Swarup, Joint Managing Director of the company.

CONSERVATION OF ENERGY / TECHNOLOGY ABSORPTION / RESEARCH & DEVELOPMENT ETC.

Particulars as required under Rule 8 (3) of the Companies (Accounts) Rules, 2014 are given in Annexure I and form part of this report.

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Managements Discussion and Analysis Report has been annexed & forms part of the Annual Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134 (5) of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed

1. That in preparation of the Annual Accounts for the financial year 2020-21, the applicable Accounting Standards have been followed along with explanation relating to material departures, if any.

2. That 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 as at 31st March, 2021 and of the results of the Company for that period.

3. That 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.

4. That the directors had prepared the Annual Accounts for the financial year 2020-21 on a going concern basis.

5. That they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating properly ; and

6. That they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return as provided under Sub-Section (3) of Section 92 of the Companies Act, 2013 ( the "Act") is enclosed at Annexure-III in the prescribed form MGT-9 and forms part of this Report.

NUMBER OF MEETINGS OF THE BOARD

4 meetings of the Board of Directors of the Company were held during the year. For detail of the meetings, please refer to the Corporate Governance Report, which forms part of this Report.

AUDIT COMMITTEE

Composition and other details pertaining to Audit Committee has been disclosed in the Corporate Governance Report.

INDEPENDENT DIRECTORS DECLARATION

Mr. Santosh Kumar Bishwal, Mr. Vivek Gupta, Mr. Kunal Agarwal, Mr. Sunil Chadha and Ms. Ruchika Bansal, who are Independent Directors, have submitted a declaration that each of them meets the criteria of independence as provided in Sub-Section (6) of Section 149 of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, there has been no change in the circumstances which may affect their status as independent director during the year.

POLICY OF DIRECTORS APPOINTMENT AND REMUNERATION

Companys policy on Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under section 178(3) of the Act are covered in Corporate Governance Report which forms part of this Report. Further, information about elements of remuneration package of individual directors is provided in the extract of Annual Return as provided under Section 92(3) of the Act, is enclosed at Annexure-III in the prescribed form MGT-9 and forms part of this Report and can be accessed on the companys website www.globusspirits. com.

CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

The Directors and members of Senior Management have affirmed compliance with the Code of Conduct for Directors and Senior Management of the Company. A declaration to this effect has been signed by the Managing Director and forms part of the Annual Report.

CODE FOR PREVENTION OF INSIDER TRADING

Your Company has adopted a comprehensive ‘Code of Conduct to Regulate, Monitor and Report of Trading by Insidersand also a ‘Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information relating to the Company, under the provisions of the Securities Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. The Board of Directors have approved and adopted the ‘Code of Conduct to Regulate, Monitor and Report of Trading by Insiders and a ‘Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information.

RELATIONSHIP BETWEEN DIRECTORS INTER-SE

None of the Directors are related to each other within the meaning of the term "relative" as per Section 2(77) of the Act and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 except Sh. Shekhar Swarup (Joint Managing Director) is the son of Sh. Ajay Kumar Swarup (Managing Director) of the Company.

ANNUAL PERFORMANCE EVALUATION

The company has a mechanism for annual performance evaluation of every Individual Directors and the Board as a whole as well as its various committees.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

There have been no loans, guarantees and investments under Section 186 of the Act during the financial year 2020-21 except to its Subsidiary M/s Unibev Limited (formerly known as M/s Uber Blenders & Distillers Limited).

SECRETARIAL STANDARDS

All the provisions of Secretarial standards has been complied by the Company during Financial Year 2020-21.

TRANSACTIONS WITH RELATED PARTIES

The Company has entered into contract / arrangements with the related parties in the ordinary course of business and on arms length basis. The details are mentioned in the notes to accounts of the financial statements. Policy on materiality of Related Party Transactions can be accessed on the companys website www. globusspirits.com.

INTERNAL CONTROL

The information about internal controls is set out in the Management Discussion & Analysis report which is attached and forms part of this Report.

RISK MANAGEMENT

The Company has a Risk Management Committee & also it has in place a Risk Management Policy to deal with various risks arising in the course of business. The key responsibilities of Risk Management Committee are namely, Identification of risks, Implementing and monitoring the risk management plan for the Company and reframe the risk management plan and policy as it may deem fit, lay down procedures to inform Board members about the risk assessment and minimization procedures, Monitoring and reviewing of the risk management plan from time to time and activities as may be required to be done under the Companies Act 2013 or SEBI listing Regulations.

VIGIL MECHANISM

The Company has established a vigil mechanism for Directors and employees to report their genuine concerns.

DIVIDEND DISTRIBUTION POLICY

As required under Regulation 43A of the Listing Regulations, the Company has formulated a Dividend Distribution Policy. This policy can be viewed on the Companys website at www. globusspirits.com.

PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES

Financial position of the subsidiary M/s Unibev Limited (Formerly known as M/s Uber Blenders & Distillers Ltd.) is provided in a separate statement AOC-1, attached to the Financial Statement pursuant to first proviso to Section 129(3) of the Act.

PARTICULARS OF REMUNERATION

The information required under section 197 of the Companies Act, 2013 and the rules made there under, in respect of employees of the Company, is follows :-

(a) The ratio of the remuneration of each director to the median remuneration of the employees of the Company

Executive Directors Ratio to the Median Remuneration*
Mr. Ajay Kumar Swarup 93.41
Mr. Shekhar Swarup 81.45
Mr. Manik Lal Dutta 23.16
Dr. Bhaskar Roy 35.24
Non-Executive Directors
(Sitting Fees only)
Sh. Santosh Kumar Bishwal 1.16
Sh. Vivek Gupta 1.16
Sh. Kunal Agarwal 0.46
Sh. Sunil Chadha 0.52
Ms. Ruchika Bansal 0.23

* for the purpose of comparison 12 months salary has been considered for all the employees even though any employee has worked for less than 12 months

(b) The percentage increase in remuneration of each

Director, Chief Executive Officer, Chief Financial Officer, Company Secretary or Manager, if any, in the financial year

Name of the Person % increase in Remuneration
Mr. Ajay Kumar Swarup (Managing Director) 38%
Mr. Shekhar Swarup (Joint Managing Director) 40%
Mr. Manik Lal Dutta (Executive Director) 21%
Dr. Bhaskar Roy (Executive Director) 20%
Sh. Santosh Kumar Pattanayak (Company Secretary) 8%

(c) The percentage increase in the median remuneration of employees in the financial year

3% (Since there is lot of variation in the no. of employees during the current year as compare to previous year, comparison of the exact median remuneration may not be accurate.)

(d) The number of permanent employees on the rolls of Company as on 31/03/2021: 568

(e) The average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration

The average increase in salaries of employees other than managerial personnel in 2020-21 was 10% approximately.

Percentage increase in the managerial remuneration for the year was also approximately 25.40%.

(f) The affirmation that the remuneration is as per the remuneration policy of the Company

The Companys remuneration policy is driven by the success and performance of the individual employees and the Company. Through its compensation package, the Company endeavors to attract, retain, develop and motivate a high performance staff. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals measured through the annual appraisal process. The Company affirms remuneration is as per the remuneration policy of the Company.

PECUNIARY RELATIONSHIP OR TRANSACTIONS OF NON-EXECUTIVE DIRECTORS

During the year, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company.

ACKNOWLEDGEMENT

The Board wishes to place on record its appreciation for the wholehearted support and valuable co-operation extended to the Company by the Central & the State Governments, Bankers, Suppliers, Associates, Contractors, employees and shareholders.

For and on behalf of the Board of Directors
(Dr. Bhaskar Roy) (Ajay K. Swarup)
Executive Director & COO Managing Director
(Santosh Kumar Pattanayak) (Shekhar Swarup)
Company Secretary Joint Managing Director
Place: New Delhi
Date : August 08, 2021