Kuwer Industries Ltd Management Discussions.

INDUSTRY STRUCTURE AND DEVELOPMENTS

The packaging industry in India is expected to reach $ 73 billion in 2020 from $ 32 billion in FY 15, according to a report prepared by FICCI and Tata Strategic Management Group (TSMG) on plastic industry titled ‘Plastic packaging: The sustainable choice. In the coming years, Indian packaging industry is anticipated to register 18 percent annual growth rate, with the flexible packaging and rigid packaging expected to grow annually at 25 percent and 15 percent, respectively.

The Indian packaging industry constitutes about 4 percent of the global packaging industry. The per capita packaging consumption in India is quite low at 4.3 kgs, compared to countries like Germany and Taiwan where it is 42 kgs and 19 kgs respectively. However, organized retail and boom in e-commerce, which offer huge potential for future growth of retailing, is giving a boost to the packaging sector.

Today, plastics are the material of choice in packaging for the sectors such as FMCG, food and beverages, pharmaceuticals etc. Globally, plastics comprise of 42 percent of packaging with the combination of rigid and flexible plastics in packaging. Plastics are used heavily for packaging due to innovative visual appeal for customer attraction and convenience. Additionally, they improve the hygiene quotient and shelf-life of the products especially in food and beverages segment.

OPPORTUNITIES & THREATS

OPPORTUNITIES

Flexible packaging market has been driving the packaging industry to new heights. Development across consumer and industrial market that uses flexible films, improvements in manufacturing practices, and continued technological innovations, the packaging market has been able to grow and evolve thereby shaping the packaging trends. As a result of the various beneficial features that come with it, right from ease of handling, storage and convenience to being economic in terms of cost savings, flexible packaging has certainly paved a strong position for itself, and is seen as a key segment driving growth of the overall packaging industry world over.

THREATS:

Flexible packaging markets tend to by highly competitive at both the national and regional levels, often with narrow margin. The global flexible packaging industry continues to be highly fragmented although a small but growing number of multinational converters are adopting a global strategy to grow their major brand owner customers who are expanding their manufacturing footprint in emerging markets in Eastern Europe, Asia, Africa and Latin America. There is an increasing concern among consumers for environmentally sustainable packaging solutions that has made R&D towards light weighting of substrates rather ubiquitous. Converters are confronted with the daunting task of coming up with solutions that leave lesser waste and thus lower carbon foot print. The narrative on sustainability now puts a much larger onus on to the packaging manufacturers to innovate and ensure reduction at source. Worldwide more and more bio-degradable products are being used and packaging films are often considered environment unfriendly. Packaging films face significant opposition from various strata of society and are subject to severe regulatory and statutory frame although it has been proved beyond reasonable doubt that this type of packaging requires much less energy during manufacturing, transportation and disposal than its rigid counterpart.

OUTLOOK

Since the last fifteen years, Kuwer has been a leading name in the complex field of Holographic Films/ Holographic Paper, Window metallised/ De-metallised films, coated lacquered films and allied products. At Kuwer we are constantly striving to achieve higher goals and have been adding new machinery and developing new products/ applications with the aim of meeting the ever-changing needs of the discerning customer. With a team of dedicated qualified professionals and Total Quality Management, we are able to deliver the right product to ensure total customer satisfaction and to maintain and keep on improving the same is companys current vision.

REVIEW OF OPERATIONS AND FUTURE PROSPECTS

During the year under review, your Company has loss from operations. Your Directors are strongly believes that in the coming financial year, your Company will maintain its profitable business and will resort for better financial results.

RISK AND CONCERN

The risks faced by the Company are categorized into strategic, financial, operational and compliance risks. In view of the changing business environment, the Company has Risk Management Policy to protect the abovementioned risk. Some of the risks that may arise in normal course of business and impact its ability for future developments inter alia include credit risk, liquidity risk, market risk etc.

Risk is an integral part of business. Risk can be broadly categorized into two broad categories: one Risk Associated at the Transactional Level and the other Risk Associated at the Decision Making Level. Risk Associated at operational level can arise out of operations, financial dealings and / or compliances of legal system. The Company has appropriate control mechanism and operating effectiveness of Internal Financial Controls & Legal Compliance System

Your Company has established a framework and process to monitor the exposures to implement appropriate measures in a timely and effective manner.

INTERNAL CONTROLS AND THEIR ADEQUACY

The Company has a proper and adequate system of internal controls to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition, and to ensure that all transactions are authorised, recorded and reported correctly and adequately. The Companys internal controls are supplemented by an extensive programme of internal audits, review by management and documented policies, guidelines and procedures. The internal control is designed to ensure that financial & other records are reliable for preparing financial information and for maintaining accountability of assets. All financial and audit control systems are also reviewed by the Audit Committee of the Board of Directors of the company on periodical basis.

HUMAN RESOURCES

Your Company firmly believes that a motivated and empowered employee is the key to competitive advantage. At present your company has adequate human resources which is commensurate with the current volume of Business activity and is reviewed by the management periodically and the company would induct competent personnel on increase/ expansion of the Business activity. Your

Companys employee value proposition is based on a strong focus on employee development, an exciting work culture, performance and empowerment. Processes such as performance improvement, talent management and competency management are platforms for individual development.

FORM NO. AOC -2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.

Particulars of Contracts / Arrangements made with Related Parties

Form for Disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub section (1) of section 188 of the Companies Act, 2013 including certain arms length transaction under third proviso thereto:

1. Details of contracts or arrangements or transactions not at Arms length basis:

There were no contracts or arrangements or transactions entered into during the year ended 31st March, 2020, which were not at arms length basis.

2. Details of material contracts or arrangement or transactions at arms length basis:

Name of Related Party Nature of Relationship Nature of contracts / arrangements / transactions Duration of Contract Salient Terms Amount paid as advance, if any
Ellora Mechanical Products Pvt. Ltd. Under the control of same Management Payment of Rent 2019-20 On arms length basis and ordinary course of business Amount paid have been adjusted against billing, wherever applicable
By order of the Board Of Kuwer Industries Limited
Sd/- Sd/-
Tarun Aggarwal Hanuman Kumar
Joint Managing Director CFO
DIN: 01320462 PAN: AKMPK3718K
D-1004, New Friends Colony, Lagma Ram Bhadra Pur
New Delhi-110025 District, Darbhanga, Bihar- 847407

Place: New Delhi Date: 02.12.2020

CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS

(Pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015)

To,

The Member of

Kuwer Industries Limited

D-1004, First Floor, New Friends Colony, New Delhi110065

I, have examined the relevant registers, records, forms, returns and disclosures received from the Directors of Kuwer Industries Limited having CIN L74899DL1993PLC056627 and having registered office at D-1004, First Floor, New Friends Colony, New Delhi110065 (hereinafter referred to as ‘the Company), produced before me by the Company for the purpose of issuing this Certificate, in accordance with Regulation 34(3) read with Schedule V Para-C Sub clause 10(i) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In my opinion and to the best of my information and according to the verifications (including Directors Identification Number (DIN) status at the portal www.mca.gov.in) as considered necessary and explanations furnished to me by the Company & its officers, I hereby certify that except Mr. Yashpal Sharma, having (DIN: 00446877), whose DIN Deactivated due to non-filing of DIR-3 KYC, none of the Directors on the Board of the Company as stated below for the Financial Year ending on 31st March, 2020 have been debarred or disqualified from being appointed or continuing as Directors of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs or any such other Statutory Authority.

Sr. No. Name of Director DIN Date of Appointment in Company
1. Jai Bhagwan Aggarwal 00315184 15/10/2003
2. Tarun Aggarwal 01320462 16/07/2001
3. Shailesh Gupta 00079956 16/07/2001
4. Pankaj Gupta 01390045 01/10/2003
5. Megha Agarwal 07129138 23/03/2015
6. Yashpal Sharma 00446877 01/10/2003

Ensuring the eligibility of for the appointment / continuity of every Director on the Board is the responsibility of the management of the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.

Amit H.V. & Associates (Company Secretaries)

Sd/- Amit Kumar (Proprietor) M. No. 48528, COP: 21725

UDIN: L74899DL1993PLC056627

Place: New Delhi Date: 18.11.2020

FORM MGT-9

EXTRACT OF ANNUAL RETURN As on financial year ended on 31.03.2020

(Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014)

I. REGISTRATION & OTHER DETAILS:
1 CIN L74899DL1993PLC056627
2 Registration Date 24th December, 1993
3 Name of the Company Kuwer Industries Limited
4 Category/Sub-category of the Company Non-Government Company Company limited by shares
5 Address of the Registered office & contact details D-1004, First Floor, New Friends Colony, New Delhi 110025
6 Whether listed company Yes
7 Name, Address & contact details of the Registrar & Transfer Agent, if any M/s Skyline Financial Services Private Limited 1st Floor, D-153A, Okhla Industrial Area, Phase I, New Delhi 110020
Ph. No. 011 2681 2682, 6473 2681

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

(All the business activities contributing 10 % or more of the total turnover of the company shall be stated)

S. No. Name and Description of main products / services NIC Code of the Product/service % to total turnover of the company
1 Manufacturing of Plastic Products 222 99.89

IV. SHARE HOLDING PATTERN (i) Category-wise Share Holding

Category of Shareholders No. of Shares held at the beginning of the year [As on 31-March-2019] No. of Shares held at the end of the year [As on 31-March-2020]
Demat Physica l Total % of Total Shares Demat Physical Total % of Total Shares % Chang e during the year
A. Promoters
(1) Indian
a) Individual/ HUF 3293700 10 3293710 36.29 3293700 10 3293710 36.29 0.00
b) Central Govt. - - 0 0.00 - - 0 0.00 0.00
c) State Govt.(s) - - 0 0.00 - - 0 0.00 0.00
d) Bodies Corp. 455428 - 455428 5.02 455428 - 455428 5.02 0.00
e) Banks / FI - - - 0.00 - - - 0.00 0.00
f) Any other - - - 0.00 - - - 0.00 0.00
Sub Total (A) (1) 3749128 10 3749138 41.31 3749128 10 3749138 41.31 0.00
(2) Foreign
a) NRI Individuals - - - 0.00 - - - 0.00 0.00
b) Other Individuals - - - 0.00 - - - 0.00 0.00
c) Bodies Corp. - - - 0.00 - - - 0.00 0.00
d) Any other - - - 0.00 - - 0.00 0.00
Sub Total (A) (2) - - - 0.00 - - - 0.00 0.00
TOTAL (A) 3749128 10 3749138 41.31 3749128 10 3749138 41.31 (0.00)
B. Public
Shareholding
1. Institutions
a) Mutual Funds - - - 0.00 - - - 0.00 0.00
b) Banks / FI - 70100 70100 0.77 - 70100 70100 0.77 0.00
c) Central Govt. - - - 0.00 - - - 0.00 0.00
d) State Govt.(s) - - - 0.00 - - - 0.00 0.00
e) Venture
Capital Funds - - - 0.00 - - - 0.00 0.00
f) Insurance - - - 0.00 - - - 0.00 0.00
Companies
g) FIIs - - - 0.00 - - - 0.00 0.00
h) Foreign
Venture Capital - - - 0.00 - - - 0.00 0.00
Funds
i) Others (specify) - - - 0.00 - - - 0.00 0.00
Sub-total (B)(1):- - 70100 70100 0.77 - 70100 70100 0.77 0.00
2. Non-
Institutions
a) Bodies Corp.
i) Indian 300172 228900 529072 5.83 269173 228900 498073 5.49 (0.34)
ii) Overseas - - - - - - - - -
b) Individuals
i) Individual shareholders holding nominal share capital upto Rs. 1 lakh 654443 533600 1188043 13.09 646071 518145 116421 6 12.83 (0.26)
ii) Individual shareholders holding nominal share capital in excess of Rs 1 lakh 3018947 32300 3051247 33.62 3097043 32300 312934 3 34.48 0.86
c) Others
(specify)
HUF 295808 0 295808 3.26 274738 0 274738 30.03 (0.23)
Overseas
Corporate - - - - - - - - -
Bodies
Clearing Members - - - - - - - - -
Trusts - - - - - - - - -
NRI 1364 189300 190664 2.10 1164 189300 190464 2.10 0.00
NBFC
Registered with 2000 0 2000 0.02 - - - - (0.02)
RBI
Sub-total (B)(2):- 4272734 98410 0 5256834 57.92 4288189 968645 5256834 57.92 0.00
Total Public (B) 4272734 1054200 5326934 58.69 4288189 1038745 5326934 58.69 0.00
C. Shares held by Custodian for GDRs & ADRs - - - - - - - - -
Grand Total (A+B+C) 8021862 10542 10 9076072 100.00 8037317 103875 5 907607 2 100.0 0 0.00

(ii) Shareholding of Promoter

SN Shareholders Name Shareholding at the beginning of the year Shareholding at the end of the year
No. of Shares % of total Shares of the company % of Shares Pledge d/ encum bered to total shares No. of Shares % of total Shares of the compa ny % of Share s Pledg ed / encu mber ed to total share s % change in shareh olding during the year
1 Tarun Aggarwal 1255008 13.83 0 1255008 13.83 0 0.00
2 J B Aggarwal 1219310 13.43 0 1219310 13.43 0 0.00
3 Shalini Aggarwal 40000 0.44 0 40000 0.44 0 0.44
4 Usha Aggarwal 756665 8.34 0 756665 8.34 0 0.00
5 Megha Aggarwal 22727 0.25 0 22727 0.25 0 0.00
6 VCT Lease Invest Pvt. Ltd 66150 0.73 0 66150 0.73 0 0.00
7 Kuwer Packaging Pvt. Ltd. 302915 3.34 0 302915 3.34 0 0.00
8 JTV Labels Pvt. Ltd 86363 0.95 0 86363 0.95 0 0.00

(iv) Shareholding Pattern of top ten Shareholders

(Other than Directors, Promoters and Holders of GDRs and ADRs):

SN For each of the Top 10 shareholder Date Reaso n Cumulative Shareholding during the year
No. of shares % of total shares No. of shares % of total shares
1 Southern India Depository Service Pvt. Ltd.At the beginning of the year 01.04.2019 138900 1.53 138900 1.53
Changes during the year No change during the year
At the end of the year 31.03.2020 138900 1.53 138900 1.53
2. Prime Securities Ltd.At the beginning of the year 01.04.2019 120840 1.33 120840 1.33
Changes during the year No change during the year
At the end of the year 31.03.2020 120840 1.33 120840 1.33
3 Sharad Kumar Darak
At the beginning of the year 01.04.2019 113636 1.25 113636 1.25
Changes during the year No change during the year
At the end of the year 31.03.2020 113636 1.25 113636 1.25
4 Vijaya Darak
At the beginning of the year 01.04.2019 227272 2.50 227272 2.50
Changes during the year No change during the year
At the end of the year 31.03.2020 227272 2.50 227272 2.50
5 Ajay Beswal
At the beginning of the year 01.04.2019 113636 1.25 113636 1.25
Changes during the year No change during the year
At the end of the year 31.3.2020 113636 1.25 113636 1.25
6 Sonal Lohia
At the beginning of the year 01.04.2019 124670 1.37 124670 1.37
Changes during the year No change during the year
At the end of the year 31.03.2020 124670 1.37 124670 1.37
7 Narender Yadav
At the beginning of the year 01.04.2019 61669 0.68 61669 0.68
12.04.2019 Buy 1200 62869 0.69
19.04.2019 Buy 300 63169 0.70
26.04.2019 Buy 500 63669 0.70
03.05.2019 Buy 2517 66186 0.73
Changes during the year 15.05.2019 Buy 9100 75286 0.83
25.05.2019 Buy 28 75314 0.83
14.06.2019 Buy 1200 76514 0.84
21.06.2019 Buy 33348 109862 1.21
28.06.2019 Buy 24811 134673 1.48
05.07.2019 Buy 275 134948 1.49
12.07.2019 Buy 750 135698 1.50
19.07.2019 Buy 887 136585 1.50
02.08.2019 Buy 5104 141689 1.56
09.08.2019 Buy 4843 146532 1.61
23.08.2019 Buy 500 147032 1.62
30.08.2019 Buy 2999 150031 1.65
13.09.2019 Buy 270 150301 1.66
20.09.2019 Buy 614 150915 1.66
27.09.2019 Buy 150 151065 1.66
04.10.2019 Buy 650 151715 1.67
18.10.2019 Buy 500 152215 1.68
22.11.2019 Buy 1500 153715 1.69
29.11.2019 Buy 750 154465 1.70
06.12.2019 Buy 2716 157181 1.73
13.12.2019 Buy 2402 159583 1.76
20.12.2019 Buy 1 159584 1.76
27.12.2019 Buy 2000 161584 1.78
31.12.2019 Buy 200 151784 1.78
17.01.2020 Buy 700 162484 1.79
14.02.2020 Buy 3000 165484 1.82
21.02.2020 Buy 5000 170484 1.88
28.02.2020 Buy 11497 181981 2.01
06.03.2020 Buy 1498 183479 2.02
13.03.2020 Buy 404 183883 2.03
At the end of the year 31.03.2020 183883 2.03 183883 2.03
8 Dheeraj Kumar Lohia
At the beginning of the year 01.04.2019 137071 1.51 137071 1.51
Changes during the year 12.04.2019 Buy 500 137571 1.52
At the end of the year 31.3.2020 137571 152 137571 152
9 Smita Singh
At the beginning of the year 01.04.2019 277272 3.05 277272 3.05
Changes during the year No change during the year
At the end of the year 31.3.2020 277272 3.05 277272 3.05
10 Dipak Kanayalal Shah
At the beginning of the year 01.04.2019 120000 1.32 120000 1.32
Changes during the year No change during the year
At the end of the year 31.03.2020 120000 1.32 120000 1.32

(v) Shareholding of Directors and Key Managerial Personnel:

S N Shareholding of each Shareholding at the beginning of the year Cumulative Shareholding during the year
Directors and each Key Managerial Personnel Date Reason No. of shares % of total shares No. of shares % of total shares
1 Jai Bhagwan Aggarwal
At the beginning of the year 01.04.2019 - 1219310 13.43% 1219310 13.43%
Changes during the year - - - - -
At the end of the year 31.03.2020 - 1219310 13.43% 1219310 13.43%
2 Tarun Aggarwal
At the beginning of the year 01.04.2019 - 1255008 13.83% 1255008 13.83%
Changes during the year - - - - -
At the end of the year 31.03.2020 1,255,008 13.83% 1,255,008 13.83%
3 Yashpal Sharma
At the beginning of the year 01.04.2019 - - 0.00% - 0.00%
Changes during the year - - - - - -
At the end of the year 31.03.2020 0.00% 0.00%
4 Shailesh Gupta
At the beginning of the year 01.04.2019 - - 0.00% - 0.00%
Changes during the year - - - 0.00% - 0.00%
At the end of the year 31.03.2020 - 0.00% 0.00%
5 Pankaj Gupta
At the beginning of the year 01.04.2019 - - 0.00% - 0.00%
Changes during the year - - - 0.00% - 0.00%
At the end of the year 31.03.2020 - - 0.00% - 0.00%
6 Megha Agarwal
At the beginning of the year 01.04.2019 - 22,727 0.25% 22,727 0.25%
Changes during the year - - - - - -
At the end of the year 31.03.2020 - 22,727 0.25% 22,727 0.25%

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment:

(Amt. Rs./Lakh)
Particulars Secured Loans excluding deposits Unsecured Loans Deposits Total Indebtedness
Indebtedness at the beginning of the financial year
i) Principal
1560.64 394.64 - 1955.62
Amount
ii) Interest due but not paid - - - -
iii) Interest accrued but not due - - - -
Total (i+ii+iii) 1560.64 394.64 - 1955.62
Change in Indebtedness during the financial year
* Addition
* Reduction
Net Change
Indebtedness at the end of the financial year
i) Principal
Amount
ii) Interest due but not paid - - - -
iii) Interest accrued but not due - - - -
Total (i+ii+iii) 1560.98 394.64 1955.62

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Remuneration to Managing Director, Whole-time Directors and/or Manager:

SN. Particulars of Remuneration

Name of MD/WTD/ Manager

Total Amount
Name Jai Bhagwan Aggarwal Tarun Aggarwal (Rs/Lac)
Designation Managing Director Joint Managing Director
1 Gross salary 9.00 9.00 18.00
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 - - -
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 - - -
(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961 - - -
2 Stock Option - - -
3 Sweat Equity -
Commission -
4 - as % of profit - - -
- others, specify - - -
5 Others, please specify - - -
Total (A) 9.00 9.00 18.00
Ceiling as per the Act - - -
SN. Particulars of Remuneration Name of Directors Total Amount
(Rs/Lac)
1 Independent Directors Yashpal Sharma Pankaj Gupta
Fee for attending board committee meetings - - -
Commission - - -
Others, please specify - - -
Total (1) - - -
2 Other Non-Executive
Directors Shailesh Gupta Megha Aggarwal -
Fee for attending board committee meetings - - -
Commission - - -
Others, please specify - - -
Total (2) - - -
Total (B)=(1+2) - - -
Total Managerial Remuneration - - -
Overall Ceiling as per the Act 100000.00 100000.00 100000.00

Note: Company does not pay any remuneration to Non-executive Directors and Independent Directors.

C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD

SN. Particulars of

Name of Key Managerial Personnel

Total
Remuneration Name Hanuman Kumar Jagdish Chandra Amount (Rs/Lac)
Designation CEO CFO CS
Gross salary - 4,20,000 3,00,000 7,20,000
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 -
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 -
(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961 -
2 Stock Option - - - -
Sweat Equity - - - -
Commission
- as % of profit - - - -
- others, specify -
5 Others, please specify - - - -
Total - 4,20,000 3,00,000 7,20,000