kg petrochem ltd share price Directors report


To

Dear Members KG Petrochem Limited

The Board of Directors present the report of the business and operations of KG Petrochem Limited ("the Company") along with the audited financial statements for the financial year ended March 31, 2023.

1. FINANCIAL PERFORMANCE

Particulars

March 31, 2023 March 31, 2022

Income from Business Operations

30335.69 35376.70

Other Income

617.64 1175.54

Total Income

30953.33 36552.24

Profit/(Loss) Before Depreciation, Interest & Tax

3262.73 4841.19

Less: Depreciation

1177.93 1721.80

Less: Interest

965.79 805.42

Profit/(Loss) Before Tax

1119.01 2313.97

Less: Tax Expenses

339.60 570.26

Net Profit/ (Loss) After Tax

779.41 1743.71

Earnings per share (Basic)

14.93 33.40

Earnings per share (Diluted)

14.93 33.40

2. STATE OF COMPANY AFFAIRS AND FUTURE OUTLOOK

During the year under review, Company has booked revenue of Rs. 30335.69 Lakhs as compared to Rs. 35376.70 Lakhs in the preceding financial year. Further after meeting administrative and tax expenses Company has booked Net Profit of Rs.779.41 Lakhs as compared to the Net Profit of Rs.1743.71 Lakhs in the preceding financial year. Our main export market, viz. USA is facing inflation resulting in subdued demand for our products. In addition to this on account of increase in input cost of raw material and finance cost Companys Net Profit has declined. Considering the USA market scenario, company has been able to deliver satisfactorily financial results. Further Segment wise result of operation is as under:-

Textile Division

During the year, its revenue from operation from Textile Division was Rs. 23654.50 Lakhs including export sales of Rs 19807.66 Lakhs (FOB) as against export of Rs. 25896.09 Lakhs (FOB) in previous year, the overall performance of the division was well above the industry peers. We have taken initiative of exploring new markets and product to improve companys performance to previous years.

Agency Division

This division looks after the consignment stockiest of GAIL (India) Ltd. for marketing and distribution of polymers in Rajasthan. There was acute shortage of HDPE / LLDPE granules as GAILs plant was under shut down for a major portion of the year. During the year the Agency Division has sold 15718.63 MT granules. amounting to Rs. 20288.34 Lakhs in comparison of 20192.28 MT amounting of Rs. 25,451.47 Lakhs and earned commission of Rs.63.05 Lakhs as compared to last year Rs. 82.07 Lakhs. We expect it to improve as their plant will become fully operational in the coming year.

Technical Textile Division

This division looks after the manufacturing of artificial leather through technical textile. During the year, revenue from operation from this division was Rs. 6,618.14 Lakhs including export sales of Rs. 1,310.45 Lakhs (FOB) as compared to Rs.4,408.05 Lakhs including export sales of Rs.1,500.34 Lakhs (FOB) in previous financial year. The performance of the division was overall satisfactory.

3. DIVIDEND

In order to conserve the resources of company the Board of Directors are not recommending any dividend this year.

4. AMOUNTS TRANSFERRED TO RESERVES

Your Board proposed to transfer Rs. 48.58 Lakhs to General Reserve in terms of Section 134(3)(j) of the Companies Act, 2013 for the financial year ended on March 31, 2023. Further, the Balance specified in the individual head is detailed as below:

(Rs. In Lakhs)

S. No.

Reserve Head Opening Balance Addition Deduction Closing Balance

1.

Revaluation Reserve 4,314.45 - 48.58 4265.87

2.

General Reserve 220.78 48.58 - 269.36

3.

Retained Earnings 11,234.38 779.41 - 12013.79

5. CHANGE IN NATURE OF BUSINESS, IF ANY

There was no change in the nature of business of the Company during the financial year 2022-2023.

6. INFORMATION ABOUT SUBSIDIARIES/ ASSOCIATES COMPANY/ JOINT VENTURES

The company does not have any Subsidiary/ Joint Venture and Associate Company.

7. CHANGES IN CAPITAL STRUCTURE

The Authorised Share Capital of the Company is Rs.7,00,00,000 (Rupees Seven Crores Only) divided into 70,00,000 (Seventy Lakhs) Equity Shares of Rs. 10.00 (Rupees Ten Only) each. Further, the paid up capital of the company is Rs. 5,22,10,000 (Rupees Five Crores Twenty Two Lakhs Ten Thousand) divided into 52,21,000 (Fifty Two Lakhs Twenty One Thousand) Equity Shares of Rs.10/- (Rupees Ten Only) each.

There was no public issue, rights issue, bonus issue or preferential issue, etc. during the year. Further, The Company has not issued shares with differential voting rights or sweat equity shares, nor has it granted any stock options during the year under review.

8. ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2023 is available on the Companys website and can be accessed at www.kgpetro.in

9. MATERIAL CHANGES AND COMMITMENTS

In pursuance to section 134(3)(L) of the Companies Act, 2013, no material changes and commitments have occurred after the closure of the financial year to which the financial statements relate till the date of this report, affecting the financial position of the Company.

10. MATERIAL ORDERS

In pursuance to Rule 8 (5) (vii) of the Companies (Accounts) Rules, 2014, no significant or material orders were passed by the regulators or courts or tribunals impacting the going concern status and Companys operations in future.

11. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Particulars of the Investments made and Advances Given made are provided in the Financial Statements (Please refer to Note No. 12 and Note No. 17 in the financial Statements). Further, the company has not given any Guarantee or provided any Security in connection with any loan taken by any person.

12. RELATED PARTY TRANSACTION

During the financial year ended March 31, 2023, all transactions with the Related Parties as defined under section 188 of the Companies Act, 2013 read with Rules framed there-under and Regulation 23 of the Listing Regulations were in the ordinary course of business and at arms length basis. Your Company does not have a ‘Material Subsidiary as defined under Regulation 16(1)(c) of the

Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations).

During the year under review, your Company did not enter into any Related Party Transactions which require prior approval of the Members. All Related Party Transactions of your Company had been ratified and confirmed by the Audit Committee and Board of Directors, as required under the Listing Regulations. Subsequently, the Audit Committee and the Board have reviewed the Related Party Transactions on a periodic basis. During the year under review, there has been no materially significant Related Party Transactions having potential conflict with the interest of the Company.

Necessary disclosures required under the AS 18 have been made in Note No. 44 of the Notes to the Financial Statements for the year ended March 31, 2023.

Your Company has formulated a Policy on materiality of Related Party Transactions and the said Policy has been uploaded on the website of the Company at www.kgpetro.in Further, your Company has an internal mechanism for the purpose of identification and monitoring of Related Party Transactions.

13. PARTICULARS OF CONSERVATION OF ENERGY, ABSORPTION OF TECHNOLOGY AND FOREIGN EXCHANGE EARNING AND OUTGO

Pursuant to provisions of Section 134(M) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo are attached as Annexure 1 to this report.

14. CREDIT RATINGS

During the financial year 2022-2023, on the basis of recent development including operational and financial performance of the Company, CARE Rating Agency has reaffirmed stable rating as follows:

Facilities

Ratings Rating Action

Long Term Bank Facilities

CARE BBB; Stable (Triple B; Outlook: Stable) Reaffirmed

Long Term/ Short term Bank Facilities

CARE BBB; Stable/ CARE A3+ (Triple B; Outlook: Stable/ A Three Plus) Reaffirmed

Short Term Bank Facilities

CARE A3+ (A Three Plus) Reaffirmed

Further, the company has been regular in making principal and interest repayments to the Banks and financial institutions.

15. BOARD AND COMMITTEE MEETINGS

The details of Board and Committee meetings held during the financial year ended on March 31, 2023 and the attendance of the Directors are set out in the Corporate Governance Report which forms part of this report.

The frequency of board meetings and quorum at such meetings were in accordance with the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standards-1 on Meetings of the Board of Directors issued by ICSI. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and the Listing Regulations.

16. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board plays crucial role in overseeing how the management serves the short and long term interests of shareholders and other stakeholders. This belief is reflected in our governance practices, under which we strive to maintain an effective, informed and independent Board of Directors and keep our governance practices under continuous review.

As on March 31, 2023, the total Board strength comprises of 8(Eight) Directors out of which 4 (Four) Directors are Executive Directors and 4 (Four) are Non- Executive Independent Directors. All Independent Directors of the company as on the date of this report have also registered on Independent Directors in Database of IICA for Independent Directors.

The Companys Board Members are from diverse backgrounds with skills and experience in critical areas like Marketing, Finance & Taxation, Economics, Law, Governance etc. Further, all Independent Directors are persons of eminence and bring a wide range of expertise and experience to the board thereby ensuring the best interests of stakeholders and the Company. They take active part at the Board and Committee Meetings by providing valuable guidance to the management on various aspects of Business, Policy Direction, Compliance etc. and play critical role on issues, which enhances the transparency and add value in the decision making process of the Board of Directors. The composition of the Board also complies with the provisions of the Companies Act, 2013 and Regulation 17 (1) of SEBI (Listing Obligation and Disclosure Requirement) Regulations, 2015. The Board reviews its strength and composition from time to time to ensure that it remains aligned with the statutory, as well as business requirements.

During the year under review, the following changes occurred in the Board of Directors:

A) RETIRE BY ROTATION

In accordance with the provisions of the Articles of Association of the Company, read with Section 152 of the Companies Act, 2013 Mrs. Prity Singhal, Director of the Company is liable

to retire by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for re-appointment.

B) APPOINTMENT/RE-APPOINTMENT OF DIRECTORs/KMPs

Mr. Ajay Kumar Sharma was appointed as an Additional Director (Executive) by Board of Directors of the Company on June 01, 2022. Re-designated as independent director on August 23, 2022.

Mr. Vikas Damani was appointed as Additional Director (Independent, Non-Executive) by Board of Directors of the Company on June 01, 2022. Re-designated as independent director on August 23, 2022.

Mr. Arpit Sukhwal was appointed as Company Secretary and Compliance Officer of the Company on October 27, 2022.

Mrs. Vani Jain was appointed as Additional Director (Independent, Non-Executive) by Board of Directors of the Company January 07, 2023.

C) RESIGNATION/RETIREMENT OF DIRECTORs/KMPs

Mr. Ajay Kumar Sharma was retired from the post of directorship of the company w.e.f. April 14, 2022 due to expiry of his tenure as per regulation 17(1)(c) of SEBI (LODR) Regulations, 2015. The Board place on record its appreciation for the assistance and guidance provided by him during his tenure as Director of the Company.

Mr. Vikas Damani was retired from the post of directorship of the company w.e.f. April 14, 2022 due to expiry of his tenure as per regulation 17(1)(c) of SEBI (LODR) Regulations, 2015. The Board place on record its appreciation for the assistance and guidance provided by him during his tenure as Director of the Company.

Mr. Aditya Trivedi, resigned as Company Secretary and Compliance Offer of the company with effect from May 01, 2022.

Mr. Kamlesh Sharma, has resigned from the post of Independent Directorship of the Company with effect from October 10, 2022.

Mr. Arpit Sukhwal, resigned as Company Secretary and Compliance Offer of the company with effect from December 17, 2022

Mr. Deepak Singhvi has ceased from the office of Chief financial officer of the Company with effect from February 13, 2023.

After the closure of the year under review, the following changes occurred in the

constitution of the Board:

A) RESIGNATION OF DIRECTOR/KMPs

Mrs. Vani Jain, Additional Independent Director of the company has retired from the post of directorship of the company w.e.f. April 05, 2023 due to expiry of her tenure as per regulation 17(1)(c) of SEBI (LODR) Regulations, 2015. The Board place on record its

appreciation for the assistance and guidance provided by him during her tenure as Director of the Company.

B) APPOINTMENT OF DIRECTOR/KMPs

Pursuant to the provisions of Section 203 read with Rule 8 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and other applicable provisions (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), if any, of the Companies Act, 2013, Ms. Himanshi Dhakad, was appointed as Company secretary & Compliance Officer of the Company effective from May 30, 2023.

Pursuant to Section 149 and 152 read with rule therein and other applicable provisions (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), if any, of the Companies Act, 2013 and as per SEBI(Listing Obligations and Disclosure requirement)Regulation, 2015, Mrs. Vani jain was appointed as Additional Director (Independent Non-Executive) on June 21, 2023.

Pursuant to the provisions of Section 179 and 203 read with The Companies (Meetings of Board and its Powers) Rules, 2014, The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and other applicable provisions (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), if any, of the Companies Act, 2013 Mrs. Prity Singhal has been appointed as Chief Financial Officer (KMP) of the Company with immediate effect from August 10, 2023.

Necessary resolutions for the appointment/re-appointment of aforesaid Directors, wherever applicable, have been incorporated in the notice convening the ensuing AGM. As required under the listing regulations and Secretarial Standards on General Meetings issued by ICSI, the relevant details of Directors retiring by rotation and/or seeking appointment/re-appointment at the ensuing AGM are furnished as "Annexure-A" to the notice of AGM.

17. DECLARATION BY INDEPENDENT DIRECTORS

Pursuant to the provisions of section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations, all Independent Directors of the Company have given declaration that they meet the criteria of independence.

It is to be further noted that as per the provisions of Rule 6 of the Companies (Appointment and Qualifications of Directors) Rules, 2014 (as amended from time to time), all four Independent Directors of the company have registered their name as Independent Directors in Database of IICA and Mr. Anand Mishra, Mr. Bridhi Chand Sharma and Mr. Vikas Dhamani have passed the online proficiency self-assessment test and Mrs. Vani Jain is exempted to clear the said online proficiency self-assessment test.

The terms & conditions for the appointment of Independent Directors are given on the website of the Company website and can be accessed at i.e. www.kgpetro.in.

Further, in terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties. The Independent Directors have also confirmed that they have complied with the Companys code of conduct prescribed in Schedule IV to the Companies Act, 2013.

18. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

In compliance with the requirements of the Act and the Listing Regulations, the Company has put in place a familiarization programme for the Independent Directors with regard to their roles, rights and responsibilities in the Company and provides details regarding the nature of the industry in which the Company operates the business models of the Company etc. which aims to provide insight to the Independent Directors to understand the business of the Company. Upon induction, the Independent Directors are familiarized with their roles, rights and responsibilities.

The details of the familiarization program for Independent Directors are available on the Companys website and can be accessed at www.kgpetro.in.

19. FORMAL ANNUAL EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and SEBI Listing Regulations.

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

The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc.

The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017. In a separate meeting of independent directors, performance of non-independent directors, the Board as a whole and Chairman of the Company was evaluated, taking into account the views of executive directors and non-executive directors.

The Chairmans performance evolution was linked to both the functioning of the board as a whole as well as the performance of each director. Independent directors reviewed the performance of the chairman of the Company after seeking inputs from the executive directors and non-executive directors.

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

At the board meeting that followed the meeting of the independent directors and meeting of Nomination and Remuneration Committee, the performance of the Board, its Committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire Board, excluding the independent director being evaluated.

The performance evaluation of Managing Directors and Executive directors of the Company was done by all the directors (excluding the director being evaluated). The Board founded the evaluation satisfactory and no observations were raised during the said evaluation in current year as well as in previous year.

20. AUDITOR AND REPORT THEREON

A. STATUTORY AUDITOR

M/s. R. Sogani & Associates, Chartered Accountants (Firm Registration Number: 018755C) were appointed as Statutory Auditors of the Company, at the Annual General Meeting held on September 09, 2019 for a period of five years from the conclusion of 39th Annual General Meeting till the conclusion of 44th Annual General Meeting.

In this regard and rules made there-under, the Company has received certificate from the in accordance with provisions of Section 141 of the Act.

M/s. R. Sogani & Associates, Chartered Accountants, have submitted their Report on the Financial Statements of the Company for the Financial Year 2022-23, which forms part of the Annual Report 2022-23.

There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Reports that may call for any explanation from the Directors.

As per sub section 12 of section 143 of the Act during the financial year no fraud was reported by the Auditor of the Company in their Audit Report.

B. SECRETARIAL AUDITOR

The Board of the company in compliance with section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 appointed M/s ARMS & Associates LLP, Company Secretaries (FRN P2011RJ023700) as the Secretarial Auditor to conduct the audit of the secretarial records of the company for the Financial Year 2022-23.

The Secretarial Auditors Report for the financial year 2022-2023 does not contain any qualification, reservation or adverse remark. The Secretarial Auditors Report in Form MR-3 is enclosed as Annexure 2 to the Boards report.

M/s ARMS & Associates LLP, Practicing Company Secretaries, are appointed as secretarial auditor of the Company for the financial year 2023-2024, as required under Section 204 of the Companies Act, 2013 and Rules there under.

During the financial year 2022-2023, no fraud was reported by the Secretarial Auditor of the Company in their Audit Report.

Annual Secretarial Compliance Report

The Company has obtained an Annual Secretarial Compliance Report for the financial year ended March 31, 2023 from M/s. ARMS & Associates LLP in compliance with the Regulation 24A of the SEBI Listing Regulations and the SEBI circular CIR/CFD/CMD1/27/2019 dated February 8, 2019. The said Report for the financial year ended March 31, 2023 has been submitted to the Stock Exchanges within the prescribed statutory timelines and annexed to the Report on Corporate Governance.

C. INTERNAL AUDITOR

In accordance with the provisions of section 138 of the Companies Act, 2013 and rules made thereunder, the Board of Directors of the Company has appointed M/s Arpit Vijay & Co., Chartered Accountants, Jaipur (FRN: 017737C) as Internal Auditors of the Company for the financial year 2022-23.

The Internal Audit Report was received quarterly by the Company and the same were reviewed and approved by the Audit Committee and Board of Directors. The quarterly Internal Audit Report received for the financial Year 2022-23 is free from any qualification, further the notes on accounts are self-explanatory and the observations were looked into by the management.

During the financial year 2022-2023, no fraud was reported by the Internal Auditor of the Company in their Audit Report.

M/s Arpit Vijay & Co., Chartered Accountants, Jaipur have been re-appointed by the Board, to conduct the Internal Audit of the Company for the financial year 2023-2024.

D. COST AUDITOR

In compliance with Section 148, coupled with Sub Rule (3) of Rule 4 of the Companies (Cost Records & Audit) Rules, 2014, it is affirmed that the requirement for Cost Audit during the financial year 2022-2023 does not apply to the company. This exemption is warranted as the companys operations do not meet the criteria stipulated within the aforementioned rules.

Despite the fact that the companys turnover exceeded Rs. 100.00 Crores during the aforementioned financial year, the nature of the companys business activities falls beyond the purview of Rule 3 of the Companies (Cost Records & Audit) Rules, 2014.

21. COMMITTEES OF BOARD

As on March 31, 2023, the Board had five committees: the audit committee, the corporate social responsibility committee, the nomination and remuneration committee, the stakeholders relationship committee and the finance committee.

During the year, all recommendations made by the committees were approved by the Board.

A detailed note on the composition, charters and meetings held during the year and attendance thereat is provided in the Corporate Governance report.

22. INSIDER TRADING PREVENTION CODE

Pursuant to the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 and amendments thereto, the Company has adopted an ‘Internal Code of Conduct for Regulating, Monitoring and Reporting of Trades by Designated Persons ("the Code").

This Code is applicable to Promoters, Member of Promoters Group, all Directors and such Designated Employees and other connected persons who are expected to have access to unpublished price sensitive information relating to the Company. The Compliance Officer shall regulate, monitor and report trading adherence to the PIT Regulations. The same is available on the website of the Company at www.kgpetro.in

23. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has a Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees in conformation with Section 177(9) of the Act and Regulation 22 of SEBI Listing Regulations, to report concerns about unethical behavior, actual or suspected fraud or violation of the Code. This Policy is available on the Companys website at www.kgpetro.in. It also provides for adequate safeguards against the victimization of employees who avail the mechanism, and allows direct access to the chairperson of the audit committee in exceptional cases. During the year, no person was denied access to the audit committee.

24. CORPORATE SOCIAL RESPONSIBILITY

The CSR initiatives and activities are aligned to the requirements of Section 135 of the Act. The Company works primarily towards environment sustainability, preventive health care, eradication of hunger, education, women empowerment, contributions to public funded Universities, Indian Institute of Technology (IITs) health and hygiene.

The Report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure 3 and forms an integral part of this Report. The Policy has been annexed as Annexure 4 of this report and the same is also uploaded on the Companys website at www.kgpetro.in

25. RISK MANAGEMENT POLICY

The Company has developed a very comprehensive Risk Management Policy under which all key risk and mitigation plan are compiled in three stages i.e. Risk assessment/ evaluation, Risk Reporting and Management of the risk evaluated and reported. The objective of the policy is to create and protect shareholders value by minimizing threats or losses, and identifying and maximizing opportunities. The Risk Management Policy defines the risk management approach across the enterprise at various levels including documentation and reporting.

26. POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE

In order to prevent sexual harassment of women at work place "The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013" was notified on December 09, 2013, under the said Act, every Company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.

In terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace.

Company has formed an "Internal Complaints Committee" for prevention and redressal of sexual harassment at workplace. The Committee is having requisite members and is chaired by a senior woman member of the organization. Further, the Company has not received any complaint of sexual harassment during the financial year 2022-2023. The following is a summary of sexual harassment complaints received and disposed of during the year 2022-2023:-

Details of Complaints

Number of complaints at the beginning of FY 2022-2023

Nil

Number of complaints of sexual harassment received in the FY 2022-2023

Nil

Number of complaints disposed off during the year to FY 2022-2023

Nil

Number of complaints to be carried down to FY 2022-2023

Nil

Number of complaints pending for more than ninety days

Nil

27. HUMAN RESOURCE MANAGEMENT, HEALTH AND SAFTEY

During the year the Company had cordial relations with workers, staff and officers. The shop floor management is done through personal touch, using various motivational tools and meeting their training needs requirements. The company has taken initiative for safety of employees and

implemented regular safety audit, imparted machine safety training, wearing protective equipments etc.

Company continued to focus on attracting new talent while investing in organic talent development to help employees acquire new skills, explore new roles and realize their potential. The Company believes in empowering its employees through greater knowledge, team spirit and developing greater sense of responsibility. The total count of regular employees as at March 31, 2023 was 1303.

28. NOMINATION AND REMUNERATION POLICY

The Companys policy on Appointment and Remuneration of Directors, Senior Management Personnel and other matters as per the provisions of section 178 (3) of the Act is available on the Companys website and can be accessed at www.kgpetro.in.

Further, the salient features of the policy have been disclosed in the Corporate Governance Report, which is a part of this Report.

29. PARTICULARS OF EMPLOYEES

The disclosure as required under the provisions of section 197 of the Act read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employees of the company will be provided upon request. In terms of first proviso to section 136(1) of the Act, the annual report and accounts excluding the aforesaid information are being sent to the shareholders and others entitled thereto. The said information is available for inspection by the shareholders at the registered office of the company during business hours on working days of the company up to the date of ensuing annual general meeting. Any shareholder interested in obtaining a copy thereof may also write to the company.

30. DEPOSITS

During the financial year under review, your Company has neither invited nor accepted or renewed any fixed deposit from public, shareholders or employees and no amount of principal or interest on deposits from public is outstanding as at the Balance Sheet date in terms of provisions of section 73 to 76 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014.

31. INTERNAL FINANCIAL CONTROLS

The details in respect of internal financial control and their adequacy are included in the Management Discussion and Analysis, which is a part of this report.

32. STATUS OF CASES FILED UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016

The company has not made any application during the financial year 2022-2023.

33. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report for the year under review as stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) is presented in a separate section forming part of the Annual Report as Annexure 5.

34. CORPORATE GOVERNANCE

The company is committed to follow best Corporate Governance practices and adheres to the Corporate Governance requirements set by the Regulators under the applicable laws/regulations. In line with the foregoing, the company has adopted a Code of Corporate Governance which acts as a guide to the company and the Board on the best practices in the Corporate Governance.

A separate section on Corporate Governance standards followed by the company and the relevant disclosures, as stipulated under Listing Regulations, Companies Act, 2013 and rules made there under forms part of the Annual Report.

A certificate from M/s. ARMS & Associates LLP, Practicing Company Secretaries, conforming compliance by the company to the conditions of Corporate Governance as stipulated under Listing Regulations, is annexed to the Report on Corporate Governance, which forms part of the Annual Report as ‘Annexure 6.

35. CODE OF CONDUCT AND ETHICS

The members of the Board and Senior Management Personnel have affirmed compliance with the Code of Conduct applicable to them during the year ended March 31, 2023. A certificate by the Chief Financial Officer and Managing Director, on the compliance declarations received from the members of the Board and Senior Management forms part of this report.

36. LISTING OF EQUITY SHARES

The equity shares of the Company are listed on BSE Ltd. on the Main Board Platform in the list of ‘X Group. Further the listing fees for the Financial Year 2023-2024 have been duly paid by the company.

37. DEMATERIALISATION OF SHARES

The Companys shares are compulsorily traded on the floor of the stock exchanges in electronic form by all investors . Equity shares of the Company representing 97.68 percent of the Companys equity share capital are dematerialized as on March 31, 2023. Under the Depository System, the International Securities Identification Number (ISIN) allotted to the Companys shares is INE902G01016.

38. DETAILS OF NON-COMPLIANCE BY THE COMPANY

The following penalties/strictures/fines were imposed on the Company by Stock Exchanges in the FY2022-23

S.No.

Compliance Requirement (Regulations/ circulars/ guidelines including specific clause) Regulation/ Circular No Fine Amount

1.

Submission of Disclosure on Related Party Transactions Reg. 23 (9) 5900/-

Apart from the above mentioned fines, no penalties/strictures/fines were imposed by SEBI or any statutory authority on any matter related to capital markets during the last three years.

39. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Pursuant to sections 124 and 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules") there was no unclaimed/ unpaid dividend, hence the company is not required to transfer any amount to Investor Education and Protection Fund.

40. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of its knowledge and ability, confirm that:

i) in the preparation of annual accounts for the year ended March 31, 2023, the applicable accounting standards have been followed along with proper explanations and disclosures relating to material departures, if any;

ii) they 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 the affairs of the Company as at March 31, 2023 and of the profit of the Company for year ended on that date;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) the annual accounts have been prepared on a going concern basis;

v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

41. STATEMENT ON COMPLIANCES OF APPLICABLE SECRETARIAL STANDARDS

The Board of Directors affirm that the company has complied with the applicable Secretarial Standards issued by the Institute of Companies Secretaries of India SS-1 and SS-2 respectively relating to Meetings of the Board, its Committees and the General Meetings.

42. ACKNOWLEDGEMENT

Your Board is grateful for the continuous patronage of our valued customers and remains committed to serving their needs by delivering more style and comfort at every step. Our Board acknowledges and appreciates the relentless efforts by employees, workmen and staff including the Management headed by the Executive Directors who have all worked together as a team in achieving a commendable business performance year on year.

Your Board wishes to place on record their appreciation for the co-operation and support received from the Banks, Government Authorities, Customers, Suppliers, BSE, CDSL, NSDL, Business Associates, Shareholders, Auditors, Financial Institutions and other individuals/ bodies for their continued co-operation and support.

Your Board wishes to place on record its deep appreciation of the Independent Directors and the Non-Executive Directors of the Company for their great contribution by way of strategic guidance, sharing of knowledge, experience and wisdom, which helps your Company to take the right decisions in achieving its business goals and to maintain its position as one of the leading players in Fabrics Industry, in India and around the world.

By Order of the Board of Directors

for KG Petrochem Ltd

SD/-

Gauri Shanker Kandoi

Chairman cum Whole-Time Director

DIN:00120330

Jaipur, August 19,2023