Gravity (India) Director Discussions


To

The Members,

Gravity (India) Limited,

Your Directors have pleasure in presenting Annual Report on the business and operations of the Company and the accounts for the financial year ended on 31st March, 2022.

1. Financial Results:

(Amount in Rs.)

Particulars 31.03.2022 31.03.2021
Turnover 12,75,91,125 2,36,00,924
Total Revenue 12,91,39,887 2,49,25,630
Less: Total Expenditure 12,80,08,341 2,87,15,805
Profit/loss before exceptional items, Extra-ordinary item and tax 11,31,547 (37,90,175)
Exceptional items 0 0
Profit / (loss) before tax 11,31,547 (37,90,175)
Less: Provision for tax/deferred tax 307,640 (9,22,135)
Net Profit after tax 823,907 (28,68,040)

2. Share Capital:

The Authorized Share Capital of the Company is divided into 1,50,00,000 Equity Shares of Rs.10 /-each, aggregating to Rs. 15,00,00,000 (Rupees Fifteen Crores only).

The Issued, Subscribed and Paid-up Capital is Rs. 9,00,19,500 (Nine Crores Nineteen Thousand Five Hundred only) divided into 9,001,950 Equity shares of Rs. 10/- each as on 31st March, 2022. There are no changes in share capital during the financial year.

3. Reserves:

During the year, the company has not transferred any amount to General Reserve.

4. Dividend:

With the view to conserve resources, the Board has not recommended any dividend for the year under review.

5. Operations:

During the year under review, the Sales turnover of the Company increased from Rs. 2,36,00,924 in the previous year to Rs. 12,75,91,125 in the current year. The net profit of the Company for the year is Rs. 823,907 as against a net loss of Rs. (28, 68,040) in the previous year.

6. Material changes occurred between the end of the Financial Year to which the financial statements relate and the date of the Report:

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year 2021-22 and the date of this report.

7. Board of Directors and Composition:

The Board of Directors comprise of eminent, experienced and reputed Individuals of the Industry. During the year, the non-executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than the sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

There was no changes in the composition of the Board of Directors of the Company, during financial year 2021 2022, except Mr. Varun Thakkar has been re-appointed as the Chairman & Managing Director of the Company for a second term of 5 years with effect from 1st October 2021. The Directors recommend the appointment for the approval of the members by means of a Special Resolution at the forthcoming Annual General Meeting of the Company.

The current compositions of the Board of Directors of the Company are as follows:

Name of the Director DIN Designation
Mrs. Dakshaben Rasiklal Thakkar 00576846 Non-Executive Non-Independent Director
Mrs. Prabhavati Venugopal Shetty 01883922 Independent Director
Mr. Varun Rasiklal Thakkar 00894145 Chairman & Managing Director
Mr. Samir Ruparelia 08551666 Independent Director

Details of the Key Managerial Personnel of the Company

Name Designation
Mr. Jay Rasiklal Thakkar Chief Financial Officer
Ms. Shreya Chawak Company Secretary & Compliance Officer
(Appointed w.e.f. August 26th , 2021)

During the year, CS Shreya Chawak, has been appointed as the Company Secretary & Compliance Officer of the Company with effect from 26th August, 2021 in place of CS Shweta Jain who resigned from the post of Company Secretary & Compliance Officer of the Company with effect from 31st January, 2021.

Mrs. Dakshaben Thakkar, Director of the Company retires by rotation at the ensuring Annual General Meeting and being eligible offers herself for re-appointment. The Board recommends the same.

Mr. Varun Rasiklal Thakkar, was appointed as the Managing Director of the company for the period of 5 years in the FY 2016-17, his term as Managing Director of the company ended during the FY 2021-22 and the company has decided to re-appoint him as Managing Director for period of further 5 years with effect from 1st October, 2021.

8. Meetings of Board of Directors:

The Board has met 5 (five) times during the financial year 2021-22 on 28th June, 2021, 27th July, 2021, 26th August 2021, 11th November, 2021 and 10th February, 2022. Details of attendance and other details of Board Meeting are specified in Corporate Governance Report.

9. Composition of Mandatory Committee:

Pursuant to the provisions stipulated in 18, 19 and 20 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company has mandatorily formed the below mentioned Committees which shall be duly constituted. The Committee Meeting details are mentioned in Corporate Governance Reports.

Name of Committee Current Constitution of the Committee
Audit Committee Mr. Samir Ruparelia, Chairman of the committee
Independent Director
Mrs. Prabhavati Shetty, Member
Independent Director
Mrs. Dakshaben Thakkar, Member
Non-Executive - Non Independent Director,
Nomination and Remuneration Committee Mr. Samir Ruparelia, Chairman of the committee
Independent Director
Mrs. Prabhavati Shetty, Member
Independent Director
Mrs. Dakshaben Thakkar, Member
Non-Executive - Non Independent Director,
Stakeholders Relationship Committee Mrs. Dakshaben Thakkar, Chairperson of the committee
Non-Executive - Non Independent Director
Mrs. Prabhavati Shetty, Member
Independent Director
Mr. Samir Ruparelia, Member
Independent Director

The details of NRC Policy are included in Corporate Governance report.

10. Independent Directors:

The Company has 02 (two) Independent Directors as on date. The Company has received declaration from all the Independent Directors of the Company under Section 149(7) the Companies Act, 2013 and the SEBI (LODR) Regulation, 2015. The Independent Directors meet once a year. The details of the meeting are included in the Corporate Governance Report.

11. Public Deposits:

The Company has not accepted any deposits within the meaning of Section 73 & 74 and hence no disclosure is required in this respect of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

12. Listing of Company’s Shares:

Your Company’s Equity Shares continue to be listed on the Bombay Stock Exchange, Mumbai in the Indo Next(S) Group. The annual listing fee for the year 2021-22 has been paid to the Bombay Stock Exchange, Mumbai.

13. Director’s Responsibility Statement:

In terms of Section 134 (5) of the Companies Act, 2013, the Board of Directors of the Company hereby state & confirm that:

In the preparation of the annual accounts, the applicable accounting standards had been followed and that no material departures have been made from the same;

(a) 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 and of the profit and loss of the company for that period;

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

(b) The directors had prepared the annual accounts on a going concern basis; and

(c) 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.

(d) The directors, have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

14. Board Evaluation:

The Board of Directors have carried out an annual evaluation of its own performance, Board committees and individual Directors pursuant to the provisions of the Act and the Corporate Governance requirements as prescribed by SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015.

The performance of the Board and Committees was evaluated by the Board after seeking inputs from all the Directors on the basis of the criteria such as the Board composition and structure, effectiveness of Board processes, information and functioning, etc.

The Board and the nomination and remuneration committee reviewed the performance of the individual Directors. On the basis of the criteria such as the contribution of the individual Director to the Board and committee meetings, preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role.

The Board of Directors of the Company believe that the Independent Directors of the Company carry their duties with integrity and expertise and have required experience to work towards the vision of the Company.

In a separate meeting of Independent Directors, performance of non-independent Directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive Directors and non-executive Directors. The same was discussed in the Board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual Directors was also discussed. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent Director being e-valuated.

15. Auditors:

M/s. LLB & Co, (Firm Registration No 117758W) Chartered Accountant, were appointed in the 30th Annual General Meeting (AGM) by the shareholders as the Statutory Auditors of the Company for a period of five years i.e., till the conclusion of the AGM to be held in the year 2022 on such a remuneration as may be fixed by the Board of Directors from time to time. M/s LLB & Co, are retiring at this AGM, and do not seek re-appointment on account of completion of their tenure. The Board of Directors propose the appointment of M/s A R Sodha and Co (FRN: 110324W), Chartered Accountants, Mumbai as the Statutory Auditors of the Company for a period of 3 (Three ) years until the 38th AGM to be held in the year 2025.

16. Accounting Standards and Accounting Policies:

The financial statements of the Company are prepared in accordance with the accounting standards issued by the Institute of Chartered Accountants of India, which forms part of the Annual Report. Indian Accounting Standards (Ind AS). The financial statements (Separate financial statements) have been prepared on accrual basis in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 and the provisions of the Companies Act, 2013.

For all periods up to and including the Year ended 31st March, 2022, the Company has prepared its Financial Statements in accordance with Accounting Standards notified under Section 133 of the Companies Act, 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (previous GAAP). These Financial Statements for the Year ended 31st March, 2022 are the first the Company has prepared in accordance with Ind-AS. For the purposes of transition to Ind-AS, the Company has followed the guidance prescribed in Ind AS.

The Financial Statements have been prepared on a historical cost basis, except for certain financial assets and liabilities which have been measured at fair value (refer accounting policy regarding financial instruments). The Financial Statements are presented in Indian Rupees ("INR") and all amounts are rounded to the nearest Lakhs, except as stated otherwise.

17. Auditor’s Report:

The Observation, comments & remarks referred to in the Statutory Auditors’ report are self-explanatory and do not require any further comments.

18. Secretarial Auditors:

Pursuant to Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Ainesh Jethwa & Associates, Practicing Company Secretary, to undertake the Secretarial Audit for the year financial Year 2021-22. The Secretarial Audit Report is annexed as Annexure-2 to this report.

The Secretarial Auditors have also issued the Annual Secretarial Compliance Certificate, for the financial year ending 31st March 2022. The same is available on the Stock Exchanges and the website of the company.

19. Reply to Comments on the Report of the Secretarial Auditors:

The Board of Director have taken note of Comments in Secretarial Audit Report and are undertaking steps for ensuring due compliances of provisions as stated therein.

20. Corporate Governance:

A separate section on Corporate Governance pursuant to Regulation 34 and Schedule V of the SEBI (Listing and Disclosure Requirements) Regulations, 2015 is included in the Annual Report as Annexure-5 and forms a part of this report. The Company has voluntarily submitted this disclosure to the members.

21. Internal Financial Control Systems and their adequacy:

The management continuously reviews the internal control systems and procedures for the efficient conduct of the Company’s business. The Company adheres to the prescribed guidelines with respect to the transactions, financial reporting and ensures that all its assets are safeguarded and protected against losses. The Internal Auditor of the Company conducts the audit on regular basis and the Audit Committee actively reviews internal audit reports and effectiveness of internal control systems.

Internal Control Systems are implemented to safeguard the Company’s assets from loss or damage, to keep constant check on the cost structure, to prevent revenue leakages, to provide adequate financial and accounting controls and implement accounting standards.

22. Management Discussion and Analysis Report:

In accordance with the Listing Regulations, the Management Discussion and Analysis Report is attached as Annexure 4 and forms part of this report.

23. Related Party Disclosures:

All related party transactions that were entered into during the financial year were on arm’s length basis and were in the ordinary course of the business. The details of the transactions are elaborated in Form AOC-2 which is an annexed to this report Annexure-3. The Company has a Related Party Transaction Policy as per Company Act 2013 & Listing Regulations, the same has been reviewed by Board of Directors in its meeting held on 26th May, 2022 11th November, 2021.

24. Conservation of energy, technology absorption and foreign exchange earnings:

Information required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of Companies (Accounts) Rules, 2014 forming part of Directors’ Report for the year ending March 31, 2022 is as follows:

(a) Conservation of energy:

Your company consumes minimum energy and strives to reduce energy consumption. Your company is conscious about its responsibility to conserve energy, power and other energy sources wherever possible. We emphasis towards a safe and clean environment and continue to adhere to all regulatory requirements and guidelines. The manufacturing team works under the guidance of expert engineers of the Company continuously strives and devises various means to conserve energy and identify methods for the optimum use of energy.

(b) Technological absorption:

The Company is planning to buy new Jacaquard textile machine during the year 2023 to 2024 to upgrade the existing capacity. The quotations for the same have also been called for.

(c) Foreign Exchange Earnings and Outgo:

The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows.

Foreign Exchange Earning: Rs. NIL

Foreign Exchange Outflow: Rs. NIL

25. Code of Conduct:

The Board of Directors had approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the Company.

The Code lays down the standard procedure of business conduct which is expected to be followed by the Members of the Board and the Senior Managerial Personnel in their business dealings, at workplace, in dealing with various stakeholders etc.

All the Board Members and Senior Managerial Personnel periodically affirm and confirm compliance to the Code of Conduct. Further the Certificate of Compliance with the Code of Conduct is appended to the Corporate Governance Report.

26. Risk Management Policy:

During the year, the Management of the Company had evaluated the existing Risk Management Policy of the Company. The Risk Management policy has been reviewed and found adequate and sufficient to the requirement of the Company. The Management has evaluated various risks and that there is no element of risk identified that may threaten the existence of the Company.

27. Vigil Mechanism for Directors and Employees:

Vigil mechanism is established for Directors and Employees to report their grievance and concerns. The details of the same are mentioned in the Corporate Governance Report.

28. Particulars of Loans, Guarantees or Investments u/s 186:

The Company has not given loans or guarantees covered under the provisions of and within limits of section 186 of the Companies Act, 2013. The Investments made by the Company is given in the Financial Statements attached to this Report.

29. Prevention of Insider Trading:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company’s shares and prohibits the purchase or sale of Company’s shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading window is closed. The Board is responsible for implementation of the Code. All the Directors and Designated employees have confirmed compliance with the Code of Conduct.

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

The Company has believed in providing a safe and harassment free environment at work place for each and every employee of the Company. The Company always endeavors to create and provide an environment that is free from discrimination and harassment including sexual harassment. Proper care is being taken by the Company in order to provide a safe and harassment free work place. No Complaints have been received during the financial year under review.

31. Corporate Governance Report from Statutory Auditors:

Certificate from the Statutory Auditor, M/s. LLB & Co, Chartered Accountants confirming compliance with the conditions of Corporate Governance as stipulated under Schedule V of the SEBI (Listing and Disclosure Requirements) Regulations, 2015, is annexed to the Corporate Governance Report forming part of the Annual Report.

32. Particulars of Employees:

No Employee of the Company draws a salary exceeding Rupees One Crore and Two Lakh per annum or Rs. 8,50,000 (Rupees Eight Lakhs and Fifty thousand) per month during the financial year. The details of employees’ remuneration required under Rule 12 is attached to this Report as Annexure 1.

33. Employee Relations:

Relations with the employees remained cordial. The Directors wish to place on record their appreciation for their cooperation received from the employees at all levels.

34. Extract of Annual Return:

The Annual Return of the Company can be accessed from the website of the Company at www.gravityindia.net

35. Other Disclosures:

(a) The Company is not required to maintain any cost records for any products U/s 148 of the Companies Act, 2013.

(b) The Board u/s 118 (10) of Companies Act, 2013 has ensured due compliance of provision of Secretarial Standards I and II issued by Institute of Company Secretaries, India (ICSI).

As the Company does not meet criteria specified under Section 135 of the Companies Act, 2013, the provisions of Corporate Social Responsibility are not applicable and hence no separate annexures or details are given for the same in this Report.

There are no frauds reported U/s 143 (12) of the Companies Act, 2013, by the Statutory Auditors or Secretarial Auditors of the Company.

(c) There are no holding, subsidiaries or associate companies of Gravity (India) Ltd. Hence, no separate disclosure is provided in this regard.

(d) There are no disclosures required to be given under equity shares with different right, ESOP or Sweat equity as company has not used any such securities.

(e) The Nomination & Remuneration policy of the company is available on the website of the company www.gravityindia.net and brief details of the same are included in Corporate Governance Report

36. Acknowledgements:

The Board expresses its gratitude and appreciates the assistance and co-operation received from the Creditors, Banks, Government Authorities, Customers and Shareholders during the year under review.

For and on behalf of the Board of Directors
Varun Thakkar
Place: Mumbai Chairman & Managing Director
Date: 02, August, 2022 DIN: 00894145