Kemp & Co. Director Discussions


Your Directors are pleased to present the 142nd Annual Report together with the Audited Financial Statements and Auditors Report for the financial year ended 31st March, 2023.

(Rs In Thousands)

Particulars

Year Ended 31.03.2023 Year Ended 31.03.2022
Revenue from operations 29,820 27,515
Profit before Depreciation and Tax 15,324 12,357
Depreciation and Amortization expenses 2,345 2,546
Profit before tax and Exceptional/Extraordinary Items 12,979 9,811
Profit Before Tax 12,979 9,811
Tax expenses 1,243 1,401
Profit for the year 11,736 8,410

OVERALL PERFORMANCE AND OUTLOOK

During the financial year ended 31st March, 2023, revenue from operations was 29,820 Thousand as against Rs27,515 Thousand during previous year, registering a increase of 8.38%. Profit before tax was atRs12,979 Thousand as against Rs 9,811 Thousand in the previous year.

Profit after tax for the year under review was at Rs11,736 Thousand against Rs8,410 Thousand in the previous year. The Company is exploring various options to improve performance in the coming year.

RESERVES & DIVIDEND

During the year under review, as well as the previous year, the Company has not transferred any amount to the General Reserves. As on 31st March, 2023, Reserves and Surplus of the Company were at 24,41,622 Thousand. Your Directors are pleased to recommend for your consideration, a dividend of 12/- (Rupees Twelve only) per equity share of 10/- each for the financial year 2022-23, as against dividend of4/-. (Rupees Four Only) per equity share of 10/- each.

ANNUAL RETURN

The copy of Annual Return is available on the Companys website at www.kempnco.com.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2, relating to ‘Meetings of the Board of Directors and ‘General Meetings respectively have been duly followed by the Company.

NUMBER OF MEETINGS OF THE BOARD

During the financial year ended 31st March, 2023, four (4) Board Meetings and four (4) Audit Committee Meetings were convened and held. A calendar of meetings is prepared and circulated in advance to your Directors. The intervening gap between the two meetings was within the period prescribed under the Companies Act, 2013. In addition, the Independent Directors had a meeting during the year under review.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirements under Section 134(3)(c) of the Companies Act, 2013 with respect to the Directors Responsibility Statement, based on their knowledge and belief and the information and explanations obtained, your Directors confirm that:

a) in the preparation of the annual accounts for the year ended 31st March, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) such accounting policies selected and applied 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 for the financial year ended 31st March, 2023 and of the profit and loss of your Company for that period;

c) proper and sufficient care has been taken for the maintenance of adequate accounting Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) annual accounts for the financial year ended 31st March, 2023 have been prepared on a going concern basis;

e) internal financial controls had been laid down and followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) proper systems had been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DECLARATION OF INDEPENDENT DIRECTORS

Pursuant to Section 134(3)(d) of the Companies Act, 2013 ("the Act"), your Company confirm having received necessary declarations from all the Independent Directors under section 149(7) of the Companies Act, 2013 declaring that they meet the criteria of independence laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

NOMINATION AND REMUNERATION POLICY

The Board has on the recommendation of the Nomination and Remuneration Committee, framed a policy for selection and appointment of Directors, Key Managerial Personnel and Senior Management Personnel and their remuneration. The policy formulates the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of a Director (Executive / Non-Executive) and also the criteria for determining the remuneration of the Directors, KMP and other employees.

Nomination and Remuneration Policy of the Company has been displayed on the Companys website i.e. www.kempnco.com.

AUDITORS Statutory Auditors

In the Annual General Meeting (AGM) held on 18th August, 2022, M/s. M L Bhuwania and Co., LLP, Chartered Accountants (Firm Registration

No. 101484W/W100197) have been reappointed as Statutory Auditors of the Company for a period of 5 (five) years commencing from the conclusion of 141st AGM till the conclusion of 146th AGM of the Company.

The Notes on financial statements referred to in the Auditors Report are self explanatory and do not call for any further comments. The Auditors Report does not contain any qualification, reservation, or adverse remark.

The Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013, including any statutory modification(s) or re-enactment(s) thereof for the time being in force.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors of your Company have re- appointed M/s. Ragini Chokshi & Co., Company Secretaries in Practice to undertake the Secretarial Audit of your Company for the Financial Year 2023-24. The Secretarial Audit Report for the Financial Year 2022-23 in the prescribed Form MR-3 forms part of this Annual Report and is appended as Annexure "A" to the Boards report. The Secretarial Audit Report does not contain any qualifications, reservations or adverse remarks.

BOARD EVALUATION

Pursuant to Section 178 of the Companies Act, 2013 and Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of the performance of the Board, its Committees and of individual Directors. Performance evaluation has been carried out as per the Nomination & Remuneration Policy of the Company.

COST RECORDS

The Company is not required to maintain cost records under Section 148(1) of the Companies Act, 2013.

FAMILIARISATION PROGRAMME

The Board members are provided with necessary documents / brochures, reports and internal policies to enable them to familiarise with your Companys procedures and practices. Periodic presentations are made at the Board Meetings and the Board Committee Meetings on business and performance updates of your Company, global business environment, business strategy and risks involved. The details of programmes for familiarisation for Independent Directors are on the website of the Company i.e. www.kempnco.com.

Every new Independent Director of the Board attends an orientation program to familiarize the new inductees with the strategy and functions of your Company. The Executive Directors / Senior Management Personnel make presentations to the inductees about your Companys strategy, products, markets, finance, human resources, technology, quality, facilities and risk management.

Further, at the time of appointment of an Independent Director, your Company also issues a formal letter of appointment outlining his / her role, function, duties and responsibilities as a Director.

CODE OF BUSINESS CONDUCT AND ETHICS FOR DIRECTORS/ MANAGEMENT PERSONNEL

The Code of Business Conduct and Ethics for Directors/Management Personnel (‘the Code), as adopted by the Board, is a comprehensive

Code applicable to Directors and Senior Management Personnel of your Company. The Code, while laying down in detail, the standards of business conduct and ethics also deals with governance aspects. A copy of the Code has been uploaded on your Companys website www. kempnco.com.

The Code has been circulated to Directors and Management Personnel and its compliance is affirmed by them regularly on an annual basis.

PARTICULARS OF LOANS, GUARANTEES, OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

Your Company has established a Policy for determining related party transactions. The Audit Committee oversees the related party transactions. Related Party Transaction Policy of the Company has been displayed on the Companys website www.kempnco.com. All contracts or arrangements entered into by the Company during the financial year with Related Parties have been done at arms length and are in the ordinary course of business.

Pursuant to Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of such transactions are provided in Form AOC-2 which is annexed herewith as Annexure "B" to this report. Related Party disclosures as per IndAS have been provided in Note No. 39 of the Financial Statements.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no adverse material changes or commitments occurred after 31st March, 2023 which may affect the financial position of the Company or may require disclosure.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As the Company is not engaged in any manufacturing activity, there are no particulars to be disclosed under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 as regards conservation of energy or technology absorption. Further, during the year under review, the Company has neither earned nor spent any foreign exchange.

RISK MANAGEMENT

The Company has a risk management framework comprising risk governance structure and defined risk management process. The risk governance structure of the Company is a formal organization structure with defined roles and responsibilities for risk management. The processes and practices of risk management of the Company encompass risk identification, classification and evaluation.

DIRECTORS

Mr. Dilip G. Piramal (DIN - 00032012), Non-Executive, Non-Independent Director of your Company retires by rotation and being eligible offers himself for re-appointment.

KEY MANAGERIAL PERSONNEL

During the year, Mr. Sunil Gupta has resigned from the position of Chief Financial Officer & Key Managerial Personnel w.e.f. 16 th May, 2023 and Mr. Vikram Somani has been appointed as Chief Financial Officer & Key Managerial Personnel w.e.f. 30 th May, 2023. The Key Managerial Personnel of your Company are Mrs. Shalini D. Piramal, Managing Director; Mr. Vikram Somani, Chief Financial Officer and Mr. Karan Gudhka, Company Secretary.

NAME OF THE COMPANIES WHICH HAVE BECOME / CEASED TO BE SUBSIDIARIES, JOINT VENTURE OR ASSOCIATE COMPANIES DURING THE YEAR

Your Company does not have any subsidiary. During the year under review, no companies have become / ceased to be subsidiaries, joint venture or associate companies of the Company.

PUBLIC DEPOSITS

During the year under review, your Company has not invited or accepted any deposits.

SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and your Companys operations in future.

MANAGEMENT DISCUSSION AND ANALYSIS

Your Companys business operations includes dealing in real estate, investments and trading in hard & soft luggage. The year witnessed rapid developments which had significant impact on the Companys business. Your Company has undertaken necessary measures for a faster recovery post the economic spillovers to ensure the Companys financial positions remains stable and secure.

Your Company has appointed M/s. Suresh Surana & Associates as Internal Auditors of your Company to ensure adequacy of internal controls.

The internal audit function maintains internal controls to safeguard your Companys assets against losses, provides a high degree of assurance regarding the effectiveness and efficiency of operations, assesses the reliability of financial

The Internal Auditors submit their reports to the Audit Committee on quarterly basis. any, in the accounting policies during the year, have been disclosed in the notes to the financial statement. The All significant Revenue from Operations of your Company for the year ended 31st March, 2023 was at Rs29,280 Thousand (Previous Year Rs27,515 Thousand), a growth of around 8.38%. Profit after Tax for the year under review amounted to Rs11,736 Thousand (Previous Year Rs 8,410 Thousand). During the year under review, Human Resources department of your Company focused effective execution of plans through qualified employees. Through a structured recruitment and training process your Company identifiedthe need of training and trained the employees to improve capabilities. A structured recruitment process has helped your Company attract the right talent at all levels. The employee strength as on 31st March, 2023, was 6 (six).

INTERNAL FINANCIAL CONTROL

Your Company has put in place adequate internal financial controls with reference to the financial statements. The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business including adherence to the Companys policies, the safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures. During the year, such controls were tested and no reportable material weaknesses in design or operation were observed.

VIGIL MECHANISM

Your Company has established a Vigil Mechanism Policy for your Directors, employees and stakeholders to safeguard against victimization of persons who use vigil mechanism and report genuine concerns. The Audit Committee oversees the vigil mechanism complaints. The Vigil Mechanism Policy of the Company has been displayed on the Companys website i.e. www.kempnco.com.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

In terms of provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013, your Company has formulated a Policy to prevent Sexual Harassment of Women at workplace and constituted Internal Complaints Committees (ICC). During the year, no compliants alleging sexual harassment of Women at workplace has been received by ICC.

SHARE CAPITAL

The paid-up Equity Share Capital of the Company as on 31st March, 2023 stood at 1,08,02,000/-. During the year under review, the Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity.

As on 31st March, 2023, none of the Directors of the Company holds instruments convertible into equity shares of the Company.

AUDIT COMMITTEE

The Audit Committee comprises of Mr. Maneck Davar, Mrs. Shalini D. Piramal and Mr. Satyen Dalal. All the recommendations made by the Audit Committee were deliberated and accepted by the Board.

PARTICULARS OF EMPLOYEES

Your Company has no employee whose remuneration details are required to be provided as per the provisions of Section 197(12) of the Companies Act, 2013 (the Act) read with Rule 5 of the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014. During the year under review, no stock options have been granted by your Company.

REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:

The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of your Company is furnished hereunder:

1. Your Directors Remuneration (including commission and variable pay) to the median remuneration of the employees of your Company for the year 2022-23 was as under:

Directors Name

Ratio of remuneration of each Director to the median employees remuneration

Mrs. Shalini D. Piramal 2.61X

2. The Percentage increase in remuneration of Managing Director, Chief Financial Officer and Company Secretary were as under:

Name

Designation

Increase (%)
Mrs. Shalini D. Piramal Managing Director 74
Mr. Sunil Kumar Gupta Chief Financial Officer 22
Mr. Karan Gudhka Company Secretary 32

3 The percentage increase in the median remuneration of employees for the Financial Year 2022–23 is around 20%. The percentage increase in the median remuneration is calculated for comparable employees and does not include employees who were not eligible.

4. The number of permanent employees on the rolls of the Company- 6

5. The Percentage increase in salaries of the managerial personnel at 50th percentile is 22%. The Percentage increase in salaries of the non-managerial personnel at 50th percentile is Nil. The increase / decrease in remuneration is not solely based on the Companys performance but also includes various other factors like individual performance, experience, skill sets, academic background, industry trends, economic situation and future growth prospects etc. There are no exceptional circumstances for increase in the managerial remuneration.

6. The remuneration paid to the Directors is as per the Remuneration Policy of the Company.

INDUSTRIAL RELATIONS

Industrial relations remained cordial throughout the year under review.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation for the dedicated services of the employees of your Company at all levels.

By Order of the Board of Directors

Place: Mumbai

SHALINI D. PIRAMAL

DILIP G. PIRAMAL

Date: 30th May, 2023

Managing Director

Director

(DIN - 01365328)

(DIN - 00032012)