keltech energies ltd Directors report

Dear Members,

Your Directors have pleasure in presenting their Forty-Sixth Annual Report on the Business and Operations of the Company and the Accounts for the Financial Year ended March 31, 2023. This report is being presented along with the Audited Financial statements for the year.

1. Financial Performance:

			(Rs. in Lakhs, except per share data)
	2022-23		202-22
Operating Profit		2611.66		1546.89
1) Interest	338.39		142.80
2) Depreciation	605.22	943.61	554.30	697.10
Profit for the year before taxation		1668.05		849.79
Less: Provision for taxation - Current Tax	421.00		190.00
- Deferred Tax	54.92	475.92	-3.21	186.79
Profit for the year		1192.13		663.00
Other Comprehensive Income
Re-measurements of post-employment benefit obligations (net of tax)		-87.39		-1.02
Profit for the year available for appropriation		1104.73		661.98

2. Company Affairs:

(Management Discussion and analysis report/Operations reports of Companys performance):

The operations for the year 2022-23 have resulted in a net profit of Rs.1104.73 Lakhs after charging depreciation, interest, tax, and comprehensive income as against Rs.661.98 Lakhs for the corresponding period of the previous year.

A. Explosives Division:

The sale of Explosives for the year under review was 61,603 MT as against 52,160 MT for the corresponding period of the previous year. The increase was mainly accepting orders in Public Sector Undertakings like Western Coalfields Limited and Singareni Collieries Co. Ltd and also enhancing customer base in dealers segment market which has added to growth in volumes.

During the year, the turnover in regard to traded goods, services, and export of finished goods in Explosives sector was same as compared to the corresponding period of the previous year.

The sale of Detonating Fuse during the year under review was 30 Million Meters as against 23 Million Meters for the corresponding period of the previous year. The sale of Other Accessories during the year under review was 661 MT as against 226 MT for the corresponding period of the previous year.The increase was due to enhancing customer base and Export Orders.

B. Perlite Division:

The sale of Perlite and Perlite based products for the year under review was 16,123 MT as against 13,602 MT for the corresponding period of the previous year, which resulted in increase of 19%. The increase in sales was mainly due to increase in Filter-Aid markets.

3. Basic Earnings Per Share:

The Companys Basic Earnings per share stood at INR.119.22 (Previous year- INR 66.31).

4. Risk Management:

During the Financial Year under review, a detailed exercise on Business Risk Management was carried out covering the entire spectrum of business operations and the Board has been informed about the risk assessment and minimization procedures. Business risk evaluation and management is an ongoing process with the Company. There is no risk identified which in the opinion of the Board may threaten the existence of the Company.

5. Dividend:

The Directors have recommended a dividend of Rs.1.50 per share (15 %) of Rs.10/- (Face Value) on the paid-up equity capital of the Company.

6. Business Focus and Highlights:

A. EXPLOSIVES DIVISION:

The Companys strategy was to enhance its base of operations in Coal Sector and other sector of business by participating in Public Sector Undertakings tenders at aggressive pricing and to achieve the same.

Your companys long-term strategy of providing quality products and robust internal controls were critical in helping us to overcome the obstacles and emerge stronger.

Your companies Research and development team have introduced new products as per the requirement of the customers. These products helped the company to increase the volumes. These volumes helped plants running full capacities. We could supply to many regions of the country by expanding its Geographical reach.

B. PERLITE DIVISION:

Diversification of Perlite and Perlite based Products in other markets like Construction and Pharma markets. New Product developments under Horticulture market.

We have expanded our horizon by going digital. Your companys products for horticulture are available now via. Ecommerce channels like Amazon and Flipkart.

C. INDUSTRIAL RELATIONS:

The industrial relations during the year under review were cordial and there were no industrial disputes.

D. OUTLOOK FOR 2023-24:

During the current financial year 2023-24, on account of stiff competition on price, sale of Explosives is expected to be under pressure. Major PSUs like M/s.Coal India Ltd, Singreni Collieries Co Ltd have understood the difficulties faced by Explosives manufacturers and have resolved the same. These steps shall be a slight respite in your companys operations. Further your Company is striving to consolidate its presence in the Explosives accessories and Perlite and Perlite based Products business. The performance of infrastructure Industry in the Country will be crucial for continued growth of Companysbusiness.

Your Company will continue to make all efforts for optimizing the overall performance.

E. CAUTIONARY STATEMENT:

The statements, expressions, information given in this Management Discussions and Analysis Report describing the Companys objectives, projections, estimates, expectations, or predictions may be deemed tobe "forward looking statements". Actual results might be substantially or materially different from those expressed or implied. Important developments that could affect the Companys operations included demand supply conditions, changes in Government, global economic scenario, and such other developments different from Companys comprehension.

7. Transfer to General Reserve:

During the year, the company has not transferred any sum from the current years profit to General Reserve.

8. Deposits:

There are no outstanding public deposits remaining unpaid as on 31st March, 2023. The Company has not accepted any public deposits under Chapter V of the Act and rules made thereunder.

9. Quality:

The quality function at KEL has been at the forefront of enabling delivery and support functions in differentiation, optimization, and de-risking. While we continue to comply with international standards, such as ISO 9001, 14001& 45001 Company, our quality and engineering departments have driven change initiatives for productivity improvements.

10. Infrastructure:

The Company is in the process of improving the infrastructure at Vishwasnagar, Garamsur and other Units.

11. Related Party Transactions:

The Company has entered into related party transactions which are in arms-length basis as mentioned in Annexure I to this Report.

12. Board Committees:

The Company has following Committees of the Board:

a) Audit Committee;

b) Stakeholders Relationship Committee;

c) Committee of Directors (Share Transfer Committee);

d) Independent Directors Committee;

e) Corporate Social Responsibility Committee; and

f) Nomination and Remuneration Committee.

The composition of each of the above Committees, their respective role and responsibility is as detailed in the Report of Corporate Governance.

13. Particulars of Loans, Guarantees or Investments:

The Company has not given any loans or guarantees and has not made any investments in other entities.

14. Directors:

a) Board Evaluation:

The Board has reviewed and evaluated the performance of all Individual Directors and the Independent Directors have reviewed and evaluated the performances of Chairman, Managing Director, and Non-Independent Directors during the Financial Year. They found that none of the Board Members have contravened any of the statutory provisions of Companies Act, 2013 and its relevant Rules, Regulations, Guidelines etc. applicable to them in exercise of their duties and responsibilities.

b) Declaration by Independent Directors:

A declaration from Independent Directors as required insub-section(6) & (7) of Section149 of the Companies Act, 2013 is obtained and the same are placed before the Board for noting. An Independent Director shall hold office for a term of upto five consecutive years onthe Board of a Company but shall be eligible for re-appointment for next five years.

c) Policy on Directors Appointment and Remuneration:

As per Section 178 of the Companies Act, 2013, the Company was required to constitute a Nomination and Remuneration Committee for the purpose of identifying qualified persons for appointment of Directors and Senior/ Key Managerial Personnel in future and to fix their remuneration and other allowances. Currently the Company has an agreement with the Managing Directorof the Company for a period of 5 years with effect from May 12, 2023.

d) Number of Meetings of the Board:

During the year four meetings of Board of Directors were held i.e., on 30th May, 2022, 08thAugust, 2022, 11th November, 2022 and on 03rd February, 2023. These meetings were held as per the provision of Section 173 of the Companies Act, 2013.

e) Whistle Blower Policy:

The Company has established a Whistle Blower Policy for Directors and employees to report their genuine concern. The details of the same have been explained in the Corporate Governance Report and the same was inserted in the website of the Company.

f) Change in Board of Directors:

Mr. Kaiyoze Beji Billimoria, (DIN: 00021204) Non-Executive-Independent Director of the Company resigned with effect from May 09, 2022.

15. Auditors:

A. Statutory Auditors and Auditors Report:

M/s.CNK & Associates, Chartered Accountants, (FRN101961 -W/W100036) have been appointed as Statutory Auditors of the Company for a period of five years effective from the conclusion of Forty-fifth Annual General Meeting till the conclusion of Fiftieth Annual General Meeting, at the Board meeting of the Company held on 08th August, 2022.

B. Cost Auditors:

Pursuant to the provisions of Section148 of the Companies Act, 2013 and the Companies (Audit & Auditors) Rules, 2014 Shri. Vikas Vinayak Deodhar, Practicing Cost Accountant, Membership No.3813, the Cost Auditor, appointed by the Company to conduct audit of the cost records of the Company for the financial year2023-24.

C. Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Shri. Swaroop Suryanarayana, C.P No. 9997, Prop: M/s Swaroop Suri and Associates, Practicing Company Secretaries, Bengaluru, have been appointed for conducting the Secretarial Audit for the year ended 31st March, 2023, and their report is annexed as Annexure 2 to this report. Pursuant to Regulation 24A of EBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018, Shri. Swaroop Suryanarayana, C.PNo.9997, Prop: M/s Swaroop Suri and Associates, Practicing Company Secretaries, Bengaluru conducted the Audit and issued the Secretarial Compliance Report for the year ended 31st March, 2023, and their report is annexed as Annexure 3 to this report.

16. Key Managerial Personnel:

A. Managing Director:

Pursuant to section 203 of the Companies Act, 2013 the Company has entered into an Agreement with the Managing Director Mr. Mahesh Vijay Wataney for a period of 5 years with effect from 12th May, 2023.

B. Chief Executive Officer:

The Company has appointed Shri. Mahesh Vijay Wataney as Chief Executive Officer with effect from 1st July, 2020 till 12th May, 2023.

C. Chief Financial Officer:

The Company has appointed Mr. P Prabhudev Chief Financial Officer with effect from 1st March, 2015.

D. Company Secretary:

The Company has appointed Mrs. Shalu Tibra as Company Secretary with effect from 1st March, 2015.

17. Extract of Annual Return:

The extract of Annual Return of the Company pursuant to sub-section (3) of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014; in Form MGT 9 has been omitted with effect from March 05, 2021.

The Company has uploaded the Annual Return (Form MGT-7) on its website http://www.keltechenergies.com/ meetings.html

18. Secretarial Standards:

The Company has complied with all applicable Secretarial Standards.

19. Link to policies onwebsite:

The policies of the Company can be accessed at http://keltechenergies.com/investors.html

i. Code of Conduct

ii. Whistle Blowers Policy

iii. Nomination and Remuneration Policy

iv. Related Party Transactions Policy

v. Corporate Social Responsibility Policy

vi. Familiarization Programmes for Independent Directors

vii. Sexual Harassment of Women at Workplace Policy

viii. Criteria for making payments to Non-Executive Directors Policy

ix. Determination of Materiality of Events Policy

x. Code of Practices and Procedures for Fair Disclosure of UPSI

(Not e: All the policies and relevant information shall be provided in the website owing to the Website Guidelines as required under Companies Act, 2013 and SEBI (LODR) Regulations, 2015)

20. Investor Education and Protection Fund (IEPF):

Pursuant to applicable provisions of Companies Act, read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, all unpaid and unclaimed dividends are required to be transferred by the Company to the IEPF established by the Government of India after the completion of 7 years. Further according to the rules, the shares on which the dividend has not been paid or claimed by the shareholders for 7 consecutive years or more shall be transferred to the demat account of the IEPF authority. Accordingly, the company has transferred the unclaimed and unpaid dividends of Rs. 1,45,155/- for the financial year 2014-15 on 20.08.2022.Further corresponding shares shall be transferred as per the requirements of the IEPF Rules. The details are available on ourwebsite.

21. Significant and Material Orders:

The Company has sufficient orders on hand for Explosives and Perlite products for sustaining current level of operations.

22. Internal Financial Control:

The Company has effective systems and procedures of internal financial control for ensuring orderly and efficient conduct of its business, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information. These systems are periodically reviewed by the Audit Committee of the Board of Directors. The Audit Committee and the Board have ensured that the said system is adequate considering the nature of business and size of transactions.

23. Committees of the Board:

A detailed note on the Board and its Committees is provided under the Corporate Governance Report in this Annual Report. The composition of the Committees and compliances, as per the applicable provisions of the Act and Rules, are as follows:

Audit Committee
Composition of the Committee & Role	Highlights of duties, responsibilities and activities
a) Shri. Prashant K. Asher -Member and Chairperson b) Mrs.Arati Saran -Member	(i) All the recommendations made by the Audit Committee during the year were accepted by the Board.
c) Shri. Ashvin Chadha- Member	(ii) The Company has adopted the Whistle Blower mechanism for Directors and all employees to report
d) Shri. Santosh L. Chowgule - Member	concerns about unethical behavior, actual or suspected fraud, or violation of the Companys Code of Business Conduct and Ethics.
	In accordance with the listing requirements, the Company has formulated policies on Related Party Transactions. The policies, including the Whistle Blower Policy, are available on our website.

Nomination and Remuneration Committee

Composition of the Committee & Role	Highlights of duties, responsibilities and activities
a) Mrs. Arati Saran -Member and Chairperson	(i) The Committee oversees and administers executive compensation, operating under a written charter adopted by the Board of Directors.
b) Shri. Prashant K.Asher -Member
c) Shri. Ashvin Chadha -Member
	(ii) The Committee has designed and continuously reviews the compensation programme for Managing and senior executives to align both short-term and long-term compensation with business objectives and to link compensation with the achievement of measurable performance goals.
	(iii) The Committee structures compensation to ensure that it is competitive in the global markets in which the Company operates in order to attract and retain the best talent. In the future, the Committee plans to use a combination of stock options, restricted stock units and performance- based stocks to align senior employee compensation with shareholder value.
	The Nomination and Remuneration Committee has framed the Nomination and Remuneration policy.

Stakeholders Relationship Committee

Composition of the Committee & Role	Highlights of duties, responsibilities and activities
a) Mrs. Arati Saran -Member and Chairperson	(i) The Committee reviews and ensures redressal of investor grievances.
b) Shri. Prashant K.Asher -Member
c) Shri. Ashvin Chadha -Member	(ii) The Committee noted that all the grievances of the investors have been resolved during the year.
d) Shri. Santosh L. Chowgule -Member

 

Committee of Directors (Share Transfer Committee)
Composition of the Committee	Highlights of duties, responsibilities and activities
a) Shri. Vijay V Chowgule - Chairman	The Committee shall overview the process of share transfers, transmissions etc. during the period and shall note the same as to delay or approvals in time.
b) Shri. Ramesh L. Chowgule - Member (Till 19.04.2023)
c) Shri. Santosh L. Chowgule - Member

 

Independent Directors Committee
Composition of the Committee	Highlights of duties, responsibilities and activities
a) Ms. Arati Saran - Member and Chairperson	(i) The Committee shall review the performance of the Non-Independent Directors of the Company.
b) Shri. Prashant K.Asher - Member
c) Shri. Ashvin Chadha - Member	(ii) The review is pursuant to provisions of Part VIII of Schedule IV of the Companies Act, 2013.

 

Corporate Social Responsibility Committee
Composition of the Committee	Highlights of duties, responsibilities, and activities.
a) Shri. Prashant K. Asher- Member and Chairperson	(i) The Committee shall plan, implement, process, an spend the funds allocated to corporate social responsibility activities.
b) Shri. Ashvin Chadha - Member
c) Ms. Arati Saran - Member	(ii) This process is pursuant to Section 135 of the Companies Act, 2013.
d) Shri. Santosh L. Chowgule - Member

24. Risk Management Policy:

As per Regulation 21(5) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Risk Management Policy is not applicable to the Company.

25. Corporate Governance:

The Corporate Governance certificate received from M/s. CNK& Associates LLP Chartered Accountants, (FRN101961- W/W100036) regarding compliance of conditions of corporate governance as stipulated in Regulation 34(3) read with Schedule V(C) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed with the report.

26. Directors Responsibility Statement:

Your Companys Directors make the following statement in terms of sub-section (5) of Section 134 of the Companies Act, 2013, which is to the best of their knowledge and belief and according to the information and explanations received from them are noted by the Board-

1. The financial statements have been prepared in conformity with the applicable Accounting Standards and requirements of the Companies Act, 2013, (" the Act") to the extent applicable to the Company; on the historical cost convention; as a going concern and on the accrual basis. There are no material departures in the adoption of the applicable Accounting Standards.

2. The Board of 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 at the end of the financial year and of the profit of the Company for that period.

3. The Board of Directors have 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. The Board of Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

4. The Board of Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

5. The financial statements have been audited by M/s. CNK & Associates LLP Chartered Accountants, Mumbai, the Companys Auditors.

27. Particulars of Employees:

The total number of employees of the company as on March 31,2023 was 246 as against 231 as on March 31,2022.

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

The Company has a robust mechanism in place to redress complaints reported under it. The Company has complied with provisions relating to the constitution of Internal Complaints Committee. During the year ended 31.03.2023, no cases of sexual harassment were reported in your Company.

During the course of the year, several initiatives were undertaken to demonstrate the Companys zero tolerance philosophy against discrimination and sexual harassment, which included creation of comprehensive and easy to understand training and communication material which are also made easily accessible.

29. Particulars of loans, guarantees or investments under section 186:

During the year the company has not sanctioned any loans, given securities or made any investments as prescribed under Section 186 of the Companies Act, 2013.

30. Conservation of energy, research and development, technology absorption, foreign exchange, and outgo:

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

I. CONSERVATION OF ENERGY (FORM‘A)

This is not applicable to Explosives Industry.

II. ABSORPTION OF RESEARCH AND DEVELOPMENT (FORM‘B)

A. Specific are as in which R&D is carried out by the Company.

I. Cost reduction.

II. Product and Technology Development for Explosives.

III. Technical Services to monitor use of Explosives by Customers.

IV Development of improved and more efficient equipment for increased productivity.

V Product Development in relation to application of Explosives and Perlite.

B. Benefits derived as a result of the above R&D:

I. Introduction of products for specific strata conditions.

II. Higher efficiency in use of Explosives to Customers.

III. Higher productivity in manufacturing process.

IV Reduction in cost of production.

V. Entry into Export market.

VI. Application of Filter Aid products in Industries specific to customer requirements.

VII. Application of Perlite products in horticulture specific to customers requirements.

C. Future Plan of Action:

I. Continue development work on Explosives.

II. Explore new businesses for diversification.

D. Expenditure on R &D:

I. Capital - NIL.

II. Recurring - Rs.31.30 Lakhs

III. Total - Rs.31.30 Lakhs

IV Total R & D expenditure as a % total turnover - 0.06%

III. TECHNOLOGY ABSORPTION, ADAPTATION, AND INNOVATION

1. Efforts, in brief, made towards technology absorption, adaptation and innovation: Modernization of existing set up to adapt to new age technologies.

2. Benefits derived as a result of the above efforts e.g., product improvement, cost reduction, product development, import substitution etc.

3. PETN, Detonating Fuse & Cast Booster products with fully indigenous equipment have been produced and supplied. These products have been well accepted by customers for use in difficult strata conditions.

4. Safety standards have been maintained, both during manufacture and usage, based on periodic feedback.

5. In case of imported technology (imported during the last five years reckoned from the beginning of the financial year) following information may be furnished.

(a) Technology imported:
(b) Year of import:
(c) Has the technology been fully absorbed?
(d) If not fully absorbed, areas where this has not taken Place, reasons there for and future plan of action	Not applicable.

IV. FOREIGN EXCHANGE EARNING AND OUTGO:

a. Activities relating to exports, etc.	The Company has exported goods worth Rs.3204.60 lakhs (C & F) during the year
b. Total Foreign exchange used and earned	The Company has used Foreign Exchange amounting to Rs.27.16 lakhs and earned Rs. 3100.16 lakhs during the year.

31. Corporate Social Responsibility (CSR):

The disclosure was made as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 the Company was required to spend a sum of Rs.12.24 lakhs towards Corporate Social Responsibility during the FY 2022-23 and accordingly the Company has spent the same.

32. Green initiatives:

Electronic copies of the Annual Report 2021-22 and the notice of the 45th Annual General Meeting are sent to all members whose e-mail addresses are registered with the Company/Depository Participants.

33. Acknowledgments:

Your directors place on record their thanks to the Canara Bank and State Bank of India for their unstinted cooperation and timely assistance. Your directors would like to make a special mention of the support extended by the various Departments of Government of India, the State Government agencies, the Tax Authorities including the Customs and Excise Departments, Department of Industrial Policy and promotion, Ministry of Corporate Affairs, Securities and Exchange Board of India and others and look forward to their continued support in all future endeavours.

The Directors acknowledge the support and co-operation extended by valued customers of the Company. Your directors also place on record their appreciation for the dedicated services rendered by the employees at all levels during the year under review.

	For and on behalf of the Board of Directors
	Vijay Vishwasrao Chowgule
	Chairperson
Place: Mumbai
Date: May 12, 2023.