huhtamaki india ltd Directors report


Your Directors have pleasure in presenting the 73rd Annual Report of Huhtamaki India Limited along with the Audited Statements of Accounts for the year ended December 31, 2022.


Your Company’s financial performance during the year was as under:

(All amounts Rs. in Million, unless otherwise stated)




Net Sales



Profit/(Loss) before Tax & Exceptional Item



Exceptional Item (Expenses)



Profit/(Loss) after Exceptional items & before Tax



Less: Provision for Current Tax



Provision for Deferred Tax



Profit/(Loss) for the year



Opening balance of Retained Earnings



Other Comprehensive Income/(Loss) for the year



Dividend on Equity Shares for the year



Adjustment relating to prior periods



Closing balance of Retained Earnings




The Company registered net sales of Rs.29,165 Million, as compared to Rs.25,708.6 Million for the previous year representing a 13.6% growth year on year. Profit before exceptional items and tax stood at Rs.559 Million as compared to Rs.(5.9) Million for the previous year. Performance during the year was impacted due to the steep increase in raw material prices from Q2 though the inflationary pressure eased towards end of the year.

The Company continues to focus on ‘Project Parivartan’ initiatives towards cost optimization, stronger price realization and better quality of growth, to turnaround its performance. Project Parivartan focuses on improving efficiency of manufacturing network, overall manufacturing productivity and reducing wastages from operations to boost the longterm competitiveness of the Company. Project Parivartan has helped improve the Company’s performance during the year and the Company will continue to focus its efforts on the Project until it reaches the expected levels.


Your Directors are pleased to recommend a dividend of Rs.2/- (Rupees Two only) per equity share (100%) having face value of Rs.2/- each, for the year ended December 31, 2022. The said dividend will absorb an amount of Rs.151 Million.

The Dividend Distribution Policy of the Company is annexed to this Report as Annexure 1.


The Company did not invite or accept deposits covered under Chapter V of the Companies Act, 2013 and there are no deposits outstanding with the Company.


The Company continued to optimize borrowings during the year by focusing on cash flows and working capital management. During the year, the Company has availed Working Capital

Demand Loan and Commercial Papers for funding Working Capital. The Company has also repaid Rs.500 Million Term Loan to BNP Paribas on the due date. Borrowings as of December 31, 2022 are in line with that as of December 31, 2021 with an increase of Rs.144 Million in short term borrowings.


Form AOC-1 is not being provided since the Company does not have a subsidiary. In accordance with the provisions of Section 136 of the Companies Act, 2013, the audited financial statements, and related information of the Company are available on the website of the Company:


Information pursuant to the provisions of Section 134 of the Companies Act, 2013 and the rules framed thereunder, relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, forms part of this Report and is given at Annexure 2.


The Report on Corporate Governance and the Certificate of the Auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated in Para C of Schedule V of the Listing Regulations, 2015, are enclosed as a separate section and forms part of this Report. A declaration signed by the Managing Director in regard to compliance with the Code of Conduct by the members of the Board and Senior Management Personnel also forms part of this Report.


A detailed review of the operations, performance and future outlook of the Company and its businesses are given in the Management Discussion and Analysis and forms a part of this Report.


Mr Dhananjay Salunkhe was appointed as Managing Director of the Company for a period of three consecutive years with effect from August 12, 2022. The appointment and remuneration payable to Mr Dhananjay Salunkhe were approved by the shareholders vide Postal Ballot on August 24, 2022.

Mr Jagdish Agarwal, was appointed as the Chief Financial Officer (CFO) from January 5, 2022 and additionally as Whole-time Director for a period of three consecutive years with effect from May 26, 2022. The appointment and remuneration payable to Mr Jagdish Agarwal were approved by the shareholders vide Postal Ballot on August 24, 2022.

Mr Marco Hilty retires at the forthcoming Annual General Meeting by rotation and being eligible, has offered himself for re-appointment. Details of the proposed re-appointment has been provided in the Explanatory Statement of the Notice of the 73rd Annual General Meeting of the Company pursuant to Section 102 of the Companies Act, 2013. The Board based on the recommendation of the Nomination and Remuneration Committee, have recommended his re-appointment.

Mr Murali Sivaraman’s term as an Independent Director of the Company is scheduled to end on December 31, 2023. Mr Sivaraman is a seasoned professional and an accomplished business leader with several decades of experience of leading multinational companies across geographies. Mr Sivaraman has held the Chair since the time of his appointment. The Board of Directors, based on the recommendation of the Nomination and Remuneration Committee, propose the re-appointment of Mr Sivaraman as Director (Non-Executive Independent Chairman) with effect from January 1, 2024 for a second term of 5 years, to the members for their approval.


The Company has received necessary declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and SEBI Listing Regulations, 2015 and the same has been noted by the Board of Directors.

The Board of Directors are of the opinion that Mr Murali Sivaraman, Ms. Seema Modi and Mr Ashok Kumar Barat, Independent Directors of the Company who were appointed on January 1, 2019, January 1, 2020, and April 1, 2020, respectively, meet the necessary criteria for continuing as Independent Directors of the Company, including having cleared the proficiency self-assessment test conducted by the Institute notified under sub-section (1) of section 150 of the Act.


The Nomination and Remuneration Committee followed a robust process for evaluation of the Board and the Committees, including each other and the Chair. Every member of the Board and Committees independently rated the performance of the Board, Committees, the other Directors and the Chair, against the criteria prescribed by the NRC and offered their feedback. The Corporate Governance Report, annexed to this Report, details the process followed.

The Company has in place a policy for appointment and remuneration of Directors and Key Managerial Personnel, encompassing the criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act, and Part D of Schedule II of the Listing Regulations, appended as Annexure 3 to the Directors’ Report. The above policy along with the criteria for selection is available on the Company’s website at flexiblepackaging/investors/corporate-governance-and- policies/policies/


SEBI, vide Notification No. SEBI/HO/CFD/CMD-2/P/ CIR/2021/562 dated May 10, 2021, replaced ‘Business Responsibility Report’ with ‘Business Responsibility and Sustainability Report’ and has mandated companies to submit the BRSR for FY2023 onwards. Although not mandatory this year, as a good corporate governance practice, the Company is pleased to present its first Business Responsibility and Sustainability Report (BRSR) for FY2022, which is a part of this Annual Report.


The Company has formulated a Familiarisation Programme for Independent Directors to appraise them of their roles, rights, responsibilities, nature of the Industry, Company’s strategy, business plan, operations, markets, products, etc. The details of the Company’s Familiarisation Programme are available on the Company’s website - web link: en-in/flexible-packaging/investors/corporate-governance- and-policies/policies/

During the year, as part of the Familiarization Program, the Independent Directors visited Huhtamaki Oyj, headquartered in Espoo, Finland The Independent Directors met members of the Supervisory Board, the President and Chief Executive Officer, members of the Global Executive Team and the Flexible Segment Leadership Team to familiarize themselves with Huhtamaki Group’s vision, mission and strategy, opportunities and challenges, sustainability initiatives and expectations, operations, markets, competitive landscape, white spaces and products and governance.

The Independent Directors visited one of Huhtamaki’s largest and sophisticated flexible packaging manufacturing plants at Ronsberg, Germany and a Fibre and Foodservices plant at Hameenlinna, Finland to familiarize themselves with the operations, innovation, customers, competition, market, best practices as regards safety, efficiency, wastage, sustainability and other manufacturing best practices. The Program offered an opportunity to the Independent Directors to get a deep insight into the flexible packaging industry, Huhtamaki’s business, products, market and competitive landscape, manufacturing practices, opportunity and threats. The Program will help the Independent Directors guide the Company to drive its long-term and short-term strategy in a responsible, sustainable, ethical and competitive way, to achieve its targets.


During the year, the Board met eight times. Particulars of attendance of directors at the said meetings are given in the Corporate Governance Report, which forms part of this Report.


The Auditors’ Report to the Members on the Accounts of the Company for the year ended December 31, 2022 is a part of the Annual Report. The said Audit Report does not contain any qualification, reservation, or adverse remark.

For FY2022, the Auditors did not report any matter under Section 143(12) of the Act and hence no disclosures are made under Section 134(3)(ca) of the Act.


On the recommendation of the Audit Committee, the Board of Directors appointed M/s. R. Nanabhoy & Co., Cost Accountants as the Cost Auditors of the Company to conduct the Cost Audit for the Financial year 2023. Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules 2014, members of the Company are required to approve the remuneration to be paid to the Cost Auditors.

Accordingly, the proposal for approval of remuneration to be paid to the Cost Auditors for the Financial Year 2023, is being placed before the members. M/s. R. Nanabhoy & Co., have confirmed that they are free from any disqualifications as specified under Section 141(3) and proviso to Section 148(3) read with Section 141(4) of the Companies Act, 2013. They have further confirmed their Independent Status.


The Board of Directors had appointed M/s. S.N. Ananthasubramanian & Co., Company Secretaries, to conduct Secretarial Audit for FY2022 pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Secretarial Audit Report in the prescribed format is annexed as Annexure 4 to this Report.


The Company has undertaken an audit for the financial year 2022 for all applicable compliances as per Securities and Exchange Board of India Regulations and Circulars/Guidelines issued thereunder.

During the Year 2022, your Company has complied with the applicable Secretarial Standards issued by the Institute of Companies Secretaries of India and Annual Secretarial Compliance Report in prescribed format is annexed as Annexure 5 to this Report.

The Annual Secretarial Compliance Report has been submitted to the stock exchanges within 60 days of the end of the financial year.


Disclosures pertaining 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 are annexed to this Report as Annexure 6.

The statement containing particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this report. In terms of Section 136 of the Companies Act, 2013 the Report and Accounts are being sent to the Members and others entitled thereto, excluding the aforesaid information. Any member interested in obtaining such information may write to the Company @ and the same will be furnished on request.


Your Company has formulated a policy on related party transactions which is also available on Company’s website at corporate-governance-and-policies/policies/.

This policy deals with the review and approval of related party transactions. The Board of Directors of the Company have set out the criteria for obtaining omnibus approval from the Audit Committee within the overall framework of the policy on related party transactions. Based on such authority granted by the Board to the Audit Committee, the Company obtained prior omnibus approval for related party transactions which are repetitive in nature, entered in the ordinary course of business and on an arm’s length basis.

During the year, the Company had not entered into any contract/arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. Hence, there were no transactions that were required to be reported in Form AOC 2 as required under Section 134(3)(h) of the Companies Act, 2013. However, members may refer to Notes to the financial statement which sets out related party disclosures pursuant to the Accounting Standards.

None of the Directors and the Key Managerial Personnel have any pecuniary relationship or transactions vis-a-vis the Company.


The Company has not granted any loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, during the financial year ended December 31, 2022.


The Corporate Social Responsibility (‘CSR’) Policy of the Company was amended in the year 2022 to bring it in line with the requirements of the Companies Act, 2013. Pursuant to the provisions of the Section 135 of the Companies Act, 2013 (the Act), your Company constituted a CSR Committee to monitor the CSR activities of the Company, details of which are provided in the Corporate Governance Report,at page 68.

Your Company is committed to CSR and strongly believes that the business objectives of the Company must be in congruence with the legitimate development needs of the society in which it operates. During the year under review, the Company has set off Rs. 20.2 Million and incurred additional expenses towards CSR activities of Rs.10.60 Million .

The CSR projects of the Company are primarily focused in the areas of environmental sustainability, healthcare, promotion of education and skill development, social welfare & rural development and providing drinking water, sanitation facilities and hygiene.

CSR Report detailing the activities of CSR spending is annexed to this Report as Annexure-7.


The Company lives by its values Care Dare Deliver - with integrity. The Company is committed to foster an atmosphere of openness and transparency and maintaining the highest ethical standards in everything it does. The Company sees compliant and ethical business conduct as responsible leadership and something that is relevant for all its employees and in every business transaction that the Company is involved.

Huhtamaki Ethics and Compliance program focuses on Huhtamaki’s commitment to integrity and legal compliance across the organization. The program serves as a toolkit supporting Huhtamaki in conducting its business in compliance with laws, regulations and ethical standards and ensuring that the Company has adequate procedures in place to prevent it from taking part in any unethical business activities. During

FY2022, the Company revised and reintroduced its new Code of Conduct and Whistle Blowing Policy to clearly articulate a set of ethical guidelines that outline the expected behaviour of all employees that defines how we treat each other, do business, and engage with stakeholders. It also explains how the Company conducts business in an ethical and responsible manner in order to earn the trust of its customers and other stakeholders. The Company believes that conducting business with integrity is the right thing to do, and it is our license to operate.


In keeping with the Company’s values, the Company promotes a speak-up culture and encourages everyone to raise their concerns and to report any suspected or observed violations of the Company’s Code of Conduct, any other policy or law and regulation. In effect, this means that if any employee has concerns about potential misconduct by colleagues, managers, suppliers, customers, other business partners, or about how we conduct business within the Company, the employee is expected to report the violation. An employee may report a potential violation to anyone listed in the WhistleBlower Policy, including a web-based tool operated by an external provider and managed by Huhtamaki Ethics and Compliance Team. The Whistleblower Policy can be accessed on the Company’s website https:// corporate-governance-and-policies/policies/.

During FY2022, various training sessions were conducted for employees across locations, physically and/or virtually, in addition to e-learning modules that were mandatory for every employee, with special focus on potential conflict of interest, anti-bribery and anti-corruption. Focus on compliance and doing business with integrity was a high priority for the Company in FY2022 with the tone being set at the top and reiterated multiple times during the year. The CoCo mascot was launched in FY2022 to strongly deliver the message of compliance.

During the year, the Company received 15 complaints under Whistle Blower/Vigil mechanism and as of date, investigations into 9 complaints have been concluded. The balance 6 complaints are being investigated. None of the complaints have any material impact on the Company and do not warrant a disclosure. There was 1 pending complaint carried over from the previous year which has been disposed of during the year. The Company believes in the highest standards of governance and has been proactive and swift in dealing with whistle-blower complaints. The Audit Committee of the Board oversees the functioning of this policy.


Risk management at Huhtamaki aims to identify potential events that may affect the achievement of Huhtamaki India’s objectives. Its purpose is to manage risks to a level that the Company is capable and prepared to accept so that there is reasonable assurance and predictability regarding the achievement of the Company’s objectives. The aim is also to enable the efficient allocation of resources and risk management efforts.

The Company has formulated Risk Management Policy to review and control risk. The Company has constituted a Risk Management Committee which oversees and monitors implementation of the Risk Management Policy, validate the process and procedure of Risk Management and Risk Mitigation and periodically review and evaluate the Company’s Risk Management Policy.

Recommendations/Observations of the Risk Management Committee are taken to the Board. The Committee and the Board also review the Risk Assessment procedures periodically to ensure that risk including the Information technology and Cyber Security risk, is controlled/mitigated by the management.

In 2022, the management identified and assessed strategic, operational and financial risks and opportunities. Risk treatment actions were defined in order to reach acceptable risk levels at each stage. The risks were reviewed by the Risk Management Committee twice during the year and taken note by the Board of Directors.

Details in respect of adequacy of internal financial controls with reference to the Financial Statements are given in the Management’s Discussion and Analysis, which forms part of this Report.


Internal control is an essential part of corporate governance and management of the Company. The Company has defined the operating principles for internal control. The Audit Committee monitors the effectiveness and efficiency of the internal control systems and the correctness of the financial reporting.

The aim of internal control is to ensure reliability of financial reporting, effectiveness and efficiency of operations as well as compliance with laws and regulations. Control of financial reporting assures that financial statements are prepared in a reliable manner. The aim is also to ensure that all financial reports published and other financial information disclosed by the Company provide a fair view on the Company’s financial situation. Control of operations is aimed at ensuring effectiveness and efficiency of operations and achievement of the Company’s strategic and financial objectives. Control of compliance ensures that the Company follows applicable laws and regulations.

Internal audit: The objective of the internal audit is to improve the effectiveness of supervising obligation of the Board. Internal audit aims at ensuring that the Company’s operations are efficient, information is adequate and reliable and that set policies and procedures are properly followed by the organization.

The internal audit function reports to the Audit Committee. The Audit Committee approves the annual internal audit plan. Audit Committee has dedicated two meetings in a year exclusively to focus on internal audit observations, key findings, conclusions and recommendations for control improvements. The implementation of the action plan is followed up regularly by the line management and the internal audit manager.


The Extracts of the annual return of the Company for Financial year 2022 has been placed on the website of the Company and can be accessed at link flexible-packaging/investors/financials.


To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134 of the Act:

a. that in the preparation of the annual financial statements for the year ended December 31, 2022, the applicable accounting standards have been followed along with proper explanation relating to material departures if any;

b. that such accounting policies as mentioned in Note 2 of the Notes to the Accounts have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on December 31, 2022, and of the profit of the Company for the year ended on that date;

c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. that the annual financial statements have been prepared on a going concern basis;

e. that proper internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f. that the proper systems to ensure compliance with the provisions of all applicable laws are in place and were adequate and operating effectively.


People are our biggest asset and the Company is invested in the holistic development, health and well-being of our employees. The Company has been providing continuous skill upgradation and learning opportunities through structured training programs, career discussions and individual development plans. A detailed note on Human Resources is mentioned in the Management & Discussion Analysis (MDA) section.

Disclosures pertaining 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 are annexed to this Report as Annexure 6.

The statement containing particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this report. Further, the report and the financial statements are being sent to the members excluding the aforesaid statement. Further, in terms of provisions of Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company.

Any member interested in obtaining such information may write to the Company @ investor.communication@huhtamaki. com and the same will be furnished on request.


The Company is an equal opportunity provider and continuously strives to build a work culture which promotes the respect and dignity of all employees across the organisation. The Company provides a safe and healthy environment for employees and has zero-tolerance to harassment of any nature. In order to provide employees with a safe working environment and also in compliance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder, the Company has formulated a well-defined policy on prevention, prohibition and redressal of complaints relating to sexual harassment of employees at workplace. The policy is gender neutral. This can be found at here.

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (‘POSH Act’) and Rules made thereunder, the Company has constituted an Internal Committee (IC). The Company conducts awareness programmes at its units to sensitise employees of acceptable behaviour and conduct at the workplace.

During the year, the Company received two complaints of harassment. One was in the nature of a complaint of harassment as envisaged in the POSH Act. This was investigated by the IC and resolved through conciliation. The other complaint was outside the purview of the Act. The Company investigated the matter and closed it in the normal course. Set out below is a status update.

Number of Complaints of sexual harassment received in the year

2 (out of which 1 was outside the scope of the Act)

Number of complaints disposed of during the year


Number of cases pending for more than ninety days


Nature of action taken by employer

POSH complaint resolved through conciliation


Your Directors state that no disclosure and/or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

• Issue of equity shares with differential rights as to dividend, voting or otherwise;

• Issue of shares (including sweat equity shares) to employees of the Company under any scheme;

• Neither the Executive Director nor the Whole-time Directors of the Company receive remuneration or commission from any of its subsidiaries;

• No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future;

• There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the Financial Year of the Company to which the Financial Statements relate and the date of this Report;


The Board wishes to place on record its gratitude for the confidence reposed in the Company by our bankers, government authorities, customers, vendors and all shareholders. The Board further wishes to record its sincere appreciation for the significant contributions made by employees at all levels for their commitment, dedication and contribution towards the operations of the Company.

By Order of the Board

For Huhtamaki India Limited

Murali Sivaraman,


(DIN No. 01461231)

Date: March 17, 2023