TO THE MEMBERS
Your Directors have pleasure in presenting the Annual Report together with the Audited
Financial Statements of the Company for the Financial Year ended 31st March
2023.
FINANCIAL RESULTS
|
( in Crore) |
| Sales & Other Income |
203.49 |
| Profit before Finance Cost & |
(5.80) |
| Depreciation (PBIDT) |
|
| Profit after Tax |
(10.80) |
| Surplus brought forward |
48.96 |
| Surplus carried to Balance Sheet |
37.46 |
DIVIDEND
Considering the financials of the Company, no dividend has been recommended by the
Board for the
Financial Year 2022-23 ended 31st March 2023.
OPERATIONS
The year 2022-23 was not an overall good year for the seed industry in general.
However, the impact varied from company to company based on their product portfolio. In
the financialnumbers case of JK Agri, were impacted by drop in overall revenue due to a
reduction of export business, lack of government orders as well as a drop in vegetable
seed sales. Due to the vagaries of monsoon and untimely rains, cropping patterns shifted
rapidly. Insufficient rains in the eastern part of the country caused farmers to shift
from hybrid paddy to varietal and saved seeds. In case of Mustard, although commodity
prices were good but due to unexpected rains in September, farmers moved to saved seeds.
Hot pepper acreages reduced significantly due to severe disease during the previous
growing season as well as low commodity prices. Low commodity prices have also had a
negative impact on Okra, Tomato and Onion seed value. On the positive side Cauliflower and
Cabbage have shown an improvement.
On the export front, your Company continues to carefully expand its geographical and
product footprints by diversifying into new crops like Bitter Gourd and Okra. In Cotton, X
- Gene Cotton deregulation process in Bangladesh is nearly complete and we are expecting
the clearance soon. During the year, export business had to face headwinds due to
political instability in many countries, forex availability & sharp currency
depreciation in the importing countries coupled with high freight costs.
In 2022, the Company introduced new hybrids in Hot pepper & Okra. Performance of
Hot pepper hybrids is encouraging and expect to grow in Kharif 2023. New product launch of
Hot pepper JK HP-1020, Sweet pepper BOXY and Tomato 8135 are doing well. Recently launched
hybrids like Millet JKMH 2702, Hybrid Maize JKMH 8110, Hybrid Paddy JKRH 2608 received
good acceptance among the farmers and registered growth over previous year.
Despite a very difficult business environment, the teams at JK Agri continue to focus
on demand generation activities to promote the products. The Company connected with more
than two hundred thousand farmers through field visits, crop shows and mandi visits. As a
strategy to focus on influencer farmers in our focus villages, the team identified a
number of farmers in 4500 Villages who cultivated our products and were satisfied with the
product performance. These initiatives are giving good mileage and in future this will
help in developing the right data base and connecting more number of farmers through
digital means. The Company has increased focus on retailers through a Retailer Connect
Program JK Vikreta to improve sales per retailer. We have also realigned our go to market
strategy and identified distributors with sharp focus on improving collection efficiency.
Sales team has identified about 1000 distributors across India to focus and scale up our
business. Optimum number of distributors will increase the efficiency and effectiveness of
our sales team to work closely with farmers and retailers.
INDUSTRY OVERVIEW AND OUTLOOK
Agriculture continues to be 17% of the GDP employing over 40% of the workforce. It
remains the backbone of Indian economy and is likely to remain core to the development of
our multi-trillion dollar economy journey. Modern input and tools are being deployed to
improve the output and efficiency of our farmlands. Mechanisation and deployment of
implements like harvesters, tillers, seeders, rotavators, sprayers etc. have added to the
productivity of the farm. Internet technologies as well as the wide coverage of mobile
phones and an ever-expanding usage of smartphones is aiding the farmers to modernise their
practices as well as get transparent access to market prices for their end products. The
governments initiative to improve infrastructure of roads and connectivity is helping
farmers reach mandis easily and reduce wastage. Improved infrastructure around irrigation
is de-risking the farmers from the impact of erratic and untimely monsoons. All these
initiatives are helping increase the farmerss income.
The concern is around the impact of global warming and consequent effects of weather
patterns like El Nino, etc. and its impact on agriculture. However, overall, the improved
demand of higher quality vegetables and food crops augurs well for the seed industry in
general.
RESEARCH AND DEVELOPMENT
Your Company continues to strengthen focus on developing products for multiple climatic
regions, domestic, ASEAN and African market to fulfil customer needs. Major focus in
research is to counter biotic stress like insects, diseases and abiotic stresses like
moisture, heat and cold tolerance.
For sustainable growth, the Company has strengthened pre-breeding in the field crops,
cotton and vegetables using various biotechnology tools for precision breeding and has
shifted from traditional molecular breeding to advanced molecular markers e.g., single
nucleotide polymorphism markers and real time polymerase chain reaction technology
platform etc. to develop products in shortest possible time. Use of biotechnology and
breeding is helping to develop disease resistant, climate resilient, more nutritious and
tastier crop varieties. We have improved strategic field trials with stringent product
advancement procedure have been put in place.
Your Company has strengthened seed production research for cost effectiveness and
improved quality by various technological interventions like Genetic
Male Sterility and Cytoplasmic Male Sterility. To stay competitive, productive and
sustainable, the Company is emphasizing on use of digital platforms, artificial
intelligence and mechanisation of R&D.
OPPORTUNITIES, THREATES, RISK AND CONCERNS Opportunities
With rising population, demand for food will continue to drive the need for better
seeds. Improved varieties of seed will be required to meet the changing needs of climate,
processing industry and modern retail. The governments focus and various subsidy and
incentive schemes for the farmers will also add to the requirement of better quality
seeds. Various infrastructure projects to increase the irrigated area augurs well for the
farming community. The governments efforts to double the farmers income is encouraging
the farmers to plant higher quality seeds so that farm output can be increased. Number of
modern techniques and tools along with awareness created by agri-tech start-ups is helping
farmers get into precision farming. This has in turn increased the appreciation of the
farming community towards the value of inputs like seeds, bio fertilisers etc.
Threats, Risk and Concerns
Agriculture continues to be dependent on the vagaries of temperature and rainfall. Not
only is quantity of rain important, but timing is even more critical. Rapidly changing
climatic conditions and impact of global climate change is having a drastic effect on the
performance of crops as well as cropping patterns.
Global R&D teams will have to understand the sudden shift of peak temperatures and
untimely rains to be able to adapt the performance of the crops to the new conditions.
Resistance to pests and the requisite modification of the plants to meet this new threat
is another important focus area for the industry. The changing weather patterns cause the
farmers to shift their planting patterns at short notice. This in turn creates a risky
situation for the companies as production of seeds takes place significantly ahead of
season. Companies will have to hold inventory to meet the needs of the farmer as and when
these patterns change.
HUMAN RESOURCE DEVELOPMENT
It is heartening to see your Company has received four successive certifications of
"Great Place to Work". The process has given us lot of insights and confirms
that we are making slow but steady progress on the people front. We were agile in our
policy and digital interventions to strengthen our culture and values.
Skilled and dedicated employees are essential to organisations success. We have an
appropriate hiring model with a cross functional approach and data repository methodology
with readiness of a wide choice of profiles. All our actions are aimed at providing
opportunities to developing talent. Regular leadership communication and connect at
various forums reiterated and reinforced the commitment towards Core values of Trust,
Openness and
Transparency as our pillars of the way forward. The appropriateness of the compensation
level is reviewed and new performance management & compensation system has been
introduced with an objective to drive progressive culture aligned with the best players in
the sector and deliver profitable growth as a company. JK Agri is driving the culture of
meritocracy based on contribution to business. The learnings and the takeaway from the top
management conference helped the Company focus on ‘organisational transformation:
Digital, agility and customers centricity. At JK Agri, employee engagements are very
important to us, events such as festivals, employee birthdays, and achievements are
celebrated in a unique manner. Strategies to promote inclusiveness are highly valued. The
recently conducted Womens day event, commemorating the culture of thanking all the women
staff including front line seasonal staff for their support and contribution, has been a
memorable event. The JKO Sports premier league had enhanced the participants morale to a
great extent. These milestones will sharpen our objectives further in the journey to build
a High-Trust, High-Performance Culture.
KEY CHANGES IN FINANCIAL INDICATORS
Key Changes in financial indicators, are given in the Notes to Financial Statements.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Internal Control Systems are the foundation for ensuring achievement of organisations
objectives of operational efficiencies, reliable financial reporting and compliance with
laws, regulations & policies.
The Company has in place Internal Control Systems commensurate with the nature of its
business, size and complexity of its operations. These systems are regularly tested for
their effectiveness by Statutory as well as Internal Auditor and were found to be
operating effectively during the year. Based on the Internal Audit
Programme approved by the Audit Committee of the Board, the Internal Auditor carry out
regular internal audits covering all offices, factory and key areas of business. Reports
of the Internal Auditor are placed before the Audit Committee on quarterly basis for
review. The Audit Committee regularly reviews the reports and discusses the actions taken
with the management in addition to reviewing the effectiveness of the internal control
systems and monitoring the implementation of audit recommendations. There are adequate
checks & balances in place, wherein deviation from the systems laid-out are clearly
identified and corrective actions are taken in the respective areas, wherever required.
INTERNAL FINANCIAL CONTROLS
The Company has laid down Internal Financial
Controls Systems, Policies and Procedures with reference to Financial Statements. The
Company also has a robust Management Information System which not only facilitates speedy
business decisions but also helps in timely preparation and sharing of reliable financial
information across various levels in the Company. The transactional controls built in SAP
ERP systems ensures appropriate segregation of duties, appropriate level of approval
mechanisms and maintenance of various records. The Internal Financial Control Systems are
regularly reviewed to ensure their effectiveness. Based on the review of the
Internal Financial Control Systems during the year by the Management, Audit Committee
and the Auditors of the Company, no material reportable weakness was observed in the
Internal Financial Control Systems during the Financial Year.
ANNUAL RETURN
The Annual Return as required under Section 92(3) and Section 134(3)(a) of the
Companies Act, 2013 (‘the Act) read with Rules made thereunder is available on the
website of the Company at
https://jkagri.com/wp-content/uploads/2023/07/Annual-Return-2022-23.pdf
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The particulars of loans given, guarantees or securities provided and investments made
as required under the provisions of Section 186 of the Act are given in the
Notes to Financial Statements.
RELATED PARTY TRANSACTIONS
During the Financial Year ended 31st March 2023, all the contracts or
arrangements or transactions entered into by the Company with the related parties were in
the ordinary course of business and on arms length basis and were in compliance with the
applicable provisions of the Act and the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (‘SEBI Listing Regulations).
Further, the Company has not entered into any contract or arrangement or transaction
with the related parties which could be considered material in accordance with the policy
of the Company on materiality of Related
Party Transactions. In view of the same, disclosure in Form AOC-2 is not applicable.
The Policy on materiality of Related Party Transactions and on dealing with Related
Party Transactions, as amended and approved by the Board, is available on the website of
the Company.
COST RECORDS
Maintenance of cost records, as specified by the Central Government under sub-section
(1) of section 148 of the Act is not required by the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Dr. Raghupati Singhania (DIN: 00036129), Non-executive Director of the Company retires
by rotation and being eligible offers himself for re-appointment at the ensuing Annual
General Meeting (AGM).
Further, pursuant to Regulation 17(1A) of SEBI Listing Regulations, the Board has
approved continuation of directorship of Dr. Raghupati Singhania, Non-executive Director,
since he has attained the age of 75 years. The Board recommends necessary Special
resolution in this regard, for approval of Members at the ensuing AGM.
The Board of Directors of the Company on recommendation of the Nomination &
Remuneration Committee, re-appointed Shri Vikrampati Singhania as Managing Director of the
Company for a term of five (5) years, commencing 7th May 2023, subject to requisite
approval of Members of the Company at the ensuing AGM. The Board recommends his
reappointment.
During the Year, the Members have approved the re-appointment of Dr. Gyanendra Shukla
(DIN:
02922133) as Whole-time Director of the Company with the designation ‘President
& Director for a term of 3 years, commencing 23rd May 2022 and also
approved re-appointment of Shri Ajay Srivastava (DIN: 00049912) as an Independent Director
of the Company for second term of 3 years, commencing 24th October 2022.
All Independent Directors of the Company have given declarations that they meet the
criteria of independence as provided in Section 149 of the Act and Regulation 16 of the
SEBI Listing Regulations.
All the Independent Directors are registered on the
Independent Directors Data Bank.
There were no other changes in the Directors/ Key
Managerial Personnel of the Company, during the period under review.
CONSERVATION OF ENERGY, ETC.
The details as required under Section 134(3)(m) of the Act read with the Companies
(Accounts) Rules, 2014 are annexed to this Report as Annexure - 1 and forms part of
it.
DEPOSITS
The Company has neither invited nor accepted any deposits from the public.
AUDITORS
(a) Statutory Auditors and their Report
M/s BGJC & Associates LLP, Chartered Accountants, were appointed as Statutory
Auditors of the Company for a second term of five consecutive years, commenced from the
conclusion of 19th AGM held on 27th August 2019 till the conclusion
of 24th AGM to be held in the year 2024. The observations of the Auditors in
their Report on Accounts and the Financial Statements read with relevant notes are
self-explanatory. The Auditors Report does not contain any qualification, reservation,
adverse remark or disclaimer. Further, no fraud has been reported by the Auditors to the
Audit Committee or the Board.
(b) Secretarial Auditor and Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Act, the Board of Directors appointed
Shri Namo Narain Agarwal, Company Secretary in Practice as Secretarial
Auditor to carry out Secretarial Audit of the Company for the Financial Year 2022-23.
The Report given by him for the said Financial Year in the prescribed format is annexed
to this Report as
Annexure – 2. The Secretarial Audit Report does not contain any qualification,
reservation, adverse remark, or disclaimer.
PARTICULARS OF REMUNERATION
Disclosure of the ratio of the remuneration of each Director to the median employees
remuneration and other requisite details pursuant to Section 197(12) of the Act read with
Rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, is annexed to this Report as Annexure - 3. Further,
Particulars of Employees pursuant to Rule 5(2) & (3) of the above Rules, also forms
part of this Report. However, in terms of provisions of Section 136 of the Act, the Report
and Accounts are being sent to all the Members of the Company and others entitled thereto,
excluding the said particulars of employees. Any member interested in obtaining such
particulars may write to the Company Secretary. The said information is available for
inspection at the Registered Office of the Company during business hours on working days
of the Company upto the ensuing AGM.
CORPORATE SOCIAL RESPONSIBILITY
Your Company believes in the process of giving back to the society and aims to
contribute to sustainable growth of the society at large. Besides undertaking projects for
overall development and welfare of the society, your Company has been working closely with
the farming community in areas of imparting agricultural knowledge, promoting preventive
healthcare, skill development and livelihood enhancement projects.
The Company has a Corporate Social Responsibility
(CSR) Policy in accordance with the provisions of the Act and rules made thereunder.
The CSR Policy along with the CSR projects approved by the Board, the composition of the
Committee and other relevant details are disclosed on the website of the Company at
https://jkagri.com/wp-content/uploads/2023/05/
CSR-Policy-2023.pdf
The Annual Report on the CSR activities undertaken by the Company during the Financial
Year under review, in the prescribed format, is annexed to this
Report as Annexure – 4.
CHANGE IN THE NATURE OF BUSINESS
During the year under review, there was no material change in the nature of business of
the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
During the year under review, there were no significant and material orders passed by
the Regulators or Courts or Tribunals that could impact the going concern status of the
Company and its future operations.
MATERIAL CHANGES AND COMMITMENTS
There have been no material changes and commitments affecting the financial position of
the Company which have occurred between the end of the Financial Year of the Company and
the date of this report.
DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND
BANKRUPTCY CODE
During the year under review, no application is made or any proceeding is pending under
the Insolvency and Bankruptcy Code, 2016.
COMPLIANCE OF SECRETARIAL STANDARDS
During the year under review, your Company has duly complied with the applicable
Secretarial Standards on Meetings of Board of Directors and General Meetings issued by the
Institute of Company Secretaries of India.
CORPORATE GOVERNANCE
Your Company reaffirms its commitment to best corporate governance practices. Pursuant
to Regulation 34 of the SEBI Listing Regulations, a Management Discussion and Analysis,
Corporate Governance Report and Auditors Certificate regarding compliance of conditions
of Corporate Governance are made a part of this Report. The Corporate Governance Report
also covers the following:
(a) Particulars of the four Board Meetings held during the Financial Year under review.
(b) Salient features of the Nomination and Remuneration Policy.
(c) Manner in which formal annual evaluation of the performance of the Board of
Directors, of its Committees and of individual Directors has been made.
(d) Details with respect to Composition of Audit Committee and establishment of Vigil
Mechanism.
(e) Details regarding Risk Management.
(f) Disclosures in relation to the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
DIRECTORS RESPONSIBILITY STATEMENT
As required under Section 134(3)(c) of the Act, your Directors state that-
(a) In the preparation of the annual accounts, the applicable accounting standards have
been followed along with proper explanation relating to material departures, if any;
(b) the accounting policies have been selected and applied consistently and judgments
and estimates made 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;
(c) proper and sufficient maintenance of adequate accounting records in accordance with
the provisions of the said Act for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(d) the annual accounts have been prepared on a going concern basis;
(e) the internal financial controls to be followed by the Company have been laid down
and that such internal financial controls are adequate and were operating effectively; and
(f) the proper systems to ensure compliance with the provisions of all applicable laws
have been devised and that such systems were adequate and operating effectively.
CAUTIONARY STATEMENT
"Managements Discussion & Analysis Report" contains forward looking
statements, which may be identified by the use of the words in that direction or connoting
the same. All statements that address expectation or projections about the future,
including but not limited to statements about the Companys strategy for growth, product
development, market position, expenditures and financial results are forward looking
statements. The Companys actual carehas been results, performance or achievements could
thus differ materially from those projected in such forward-looking statements. The
Company assumes no responsibility to publicly amend, modify or revise any forward -
looking statements on the basis of any subsequent development, information or events.
ACKNOWLEDGEMENTS
Your Directors wish to acknowledge and place on record the commitment and dedication on
the part of the employees of your Company.
Your Directors would also like to acknowledge and record their appreciation of the
continued support and assistance received by the Company from its valued Customers,
Dealers, Suppliers, Shareholders, Banks and Central and various State Governments
Agencies.
On behalf of the Board of Directors
| Date: 3rd May 2023 |
Bharat Hari Singhania |
| Place: New Delhi |
|
+91-9892691696
