Narmada Gelatines Ltd Directors Report.

Your Directors are pleased to present the 59^ Annual Report of Narmada Gelatines Limited (the Company) along with the audited financial statements for the financial year ended 31st March, 2020.

Financial Highlights (Rs. lacs)
2019-20 2018-19
Revenue from Operations 13,425.00 12,56820
Otherlncome 555.83 545.49
Total Income 13,980.83 13,113.69
Total expenses 12,19696 11,789.83
Profitbefore tax 1,783.87 1,323.86
Tax Expense 495.86 317.57
Pro fit after taxation 1,288.01 1,006.30
OtherComprehensive Income:
Re-measurements of net
defined benefitplans 2.84 (15.47)
Net Profit forthe year 1,290.85 990.83

Operating Performance

During the yea runderreview, yourcompany recorded a turnover of Rs.134.25 crones as compared to Rs.125.68c rare sin the previous year. Profit after tax at f12.88 crores improved significantly as compared to Rs.10.06croresin 2018-19. Consequently, Eamingsper share increased to Rs.21.29ascompared to Rs.1663in 2018-19.

lmpactofCovid-19onfhe performance

Countrywide lockdownswere enforced during the second halfof March 2020due to the COVID-19 (new Corona virus) pandemic, thereby affecting the entire Indian economy. Whilst the impactof this was not very significant on the results of FY 2019-20, the continuing lockdown and consequently reduced businessactivity in general in FY 2020-21 has begun to adversely impact sales supply chain aswell ascosts In qua rte r first of current financial year, yourcompany hasoperated at80% level compared to the previousyear.

The management has at the time of approving the financial statements assessed the potential impactof the COVID-19on the Company. Based on the current assessment, the management hasevaluated the impacton itsassetsand liabilities particularly, inventory, investments trade receivables, advances etc. based on internal and external source of information and concluded thatthe carrying value of these assetsare recoverable and no uncertainty exists on meeting the financial liabilities in the foreseeable future.

Since April2020, the Company hasstarted resuming itsoperations in manufacturing activitiesaftertaking requisite permissions from the Government authorities and as per issued government guidelines The top-most priority forthe Company wasto ensure the safely of its employees and several measures have been taken to ensure theirwell-being. Regional salesofflcesare told to work from home. Employees who are working in manufacturing location, theirsafefy isbeing ensured bystringentuse ofprotective gear, frequent area sanitization, abiding by social distancing norms and taking all the necessary safety precautions The Company hasalso supported variousGovemmentlnitiativesand helping communitiesaround to fightthe pandemic.

Dividends

Based on the companysperformance, the Directorsare pleased to recommend a dividend of Rs.10.00 per Equity Share (previous year f 10.00 per Equity Share) forthe financial year ended 31st

March, 2020. The total outflow on account of the proposed dividend willbe f604.96lacs(previousyearf728.11 lacsincluding dividend distribution tax). The dividend on equity shares, if approved atthe ensuing AnnualGeneralMeeting, willbe paid to Memberswhose namesappearin the RegisterofMembersason 18" September, 2020and to Memberswhose namesappearon that date as Beneficial Ownersasfumished by National Securities Depository Limited (NSDL)and CentralDepository Services (India) Limited (CDSL). Pursuant to the Finance Act, 2020, dividend income willbe taxable in the handsofthe Shareholdersw.e.f April 1, 2020 and the Company is required to deduct tax at source ("IDS") from dividend paid to the Membersatprescribed ratesas perthe lncomeTaxAct,1961.

Share Capital

The Paid-up Equity Share Capital of the Company as on 31st March 2020wasRs. 604.96 la cscom prising of60,49,587 equity shares ofRs.1Q/-each. The Company ha snot issued sha re swith differential voting rights, employee stockoptionsand s/veatequityshares The Company ha spaid Listing Feesforthe financial year2020-21 to The BombayStockExchange Ltd., where itsequilysharesare listed.

Transferto Reserves

Itisproposed to transferan amountoffl29.08lacs(being 10%of the netprofitsforthe year) to the Genera I Reserve.

Quality initiatives

The Company iscommitted to the highest levels of qualify for its productsand customerservices During the financialyear2019-20, the Company retained its ISO certification for Quality Management (ISO 9001:2015), EDQM Certification from European Directorate forthe Quality of Medicines and Healthcare, DNV Management System Certification forFood Safely Management System Standard (ISO 22000 2005), KOSHER Certification and Halal Assurance System Certification from MajelisUlama, Indonesia.

Depositsficm public

During the yea runderreview, the Company has not accepted any deposits from public as defined under Chapter V of the Companies Act, 2013 and as such, no amount on account of principalorintereston depositsffom public wasoutstanding ason the date ofthe balance sheet.

ParticularsofLoans,Guaranteesand Investments DetailsofLoans, Guaranteesand Investmentscovered underthe provisionsofSection 186ofthe CompaniesAct, 2013are given in the notestothe Financial Statements

Corporate Social Responsibility (CSR)

A briefoutline ofthe Corporate Social Responsibility (CSR) policy of the Company and the initiatives undertaken on CSR activities during the yea rare se tout in Annexure - lofthisreportin the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules 2014. Details regarding the CSR Committee are covered in Corporate Governance Report, which isa partofthis report. The CSR policy isavailable on the website ofthe company www. narmadaaelatines com.

Risk Management

The Risk Management Committee has been entrusted with the responsibility to assist the Board in (a) approving the Companys Risk Management Framework and (b) overseeing strategic, operational, financial, liquidity, security, regulatory, legal, environmental, human recourse, and other risks that have been identified and assessed to ensure that there is a sound Risk Management Policy in place to address such concems/risks The

Risk Management process covers risk identification, assessment, analysisand mitigation. Incorporating sustainability in the process also helpsto align potential exposures with the risk appetite and highlight risks associated with chosen strategies The Audit Committee hasadditional oversight in the area of financial risks and controls Major risks identified by the businessand functions are systematically addressed through mitigating actions on continuing basis The detailsofthe RiskManagementCommittee, its terms of reference, key business risks identified and mitigation plansare se tout in the Corporate Governance Report.

Vigil Mechanism /Whistle BlowerPolicy

The Company has a Vigil mechanism / Whistle-blower Policy in place to encourage and facilitate employeesto reportconcems aboutunethicalbehavior, actual/suspected ffaudsand violation ofCompanys Code of Conduct or Ethics The policy provides for adequate safeguards against victimisation of persons who avail of the same and provides for direct access to the chairperson ofthe AuditCommittee. The AuditCommittee ofthe Company oversees the implementation of the Whistle-Blower Policy. Information on Whistle-Blower Policy is available on the Companys website www.narma da gelatine scorn and in the Corporate Governance Report.

Reporting ofFrauds

There were no instances of fraud or suspected frauds reported during the year under review, which required the Statutory Auditors to report to the AuditCommittee and /orBoard under Section 143(12) ofthe Actand the rulesmade thereunder.

Subsidiaries, JointVenturesand Associate Companies

The Company does not have any subsidiary, joint ventures or

associate companies

Directorsand Key Managerial Personnel

Mr. Sanjeev Jain, erstwhile Non-Executive Director of the Company, leftfbrheavenlyabode suddenlyon 3rd January, 2020. Late Mr. Jain wasassociated with the Company formore than a decade and the Company immensely benefitted from hisvision and leadership. His sad demise is an irreparable loss to the Company. The Board of Directors ofthe Company express their deep condolencesand paytribute to late Mr. Sanjeev Jain.

Regulation 17(1 A) ofthe Listing Regulations provides that listed entitiesshallnotappointany person orcontinue the directorship of any person who hasattained the age of75yearsunlessapproval ofshareholdershave been obtained by way ofspecial resolution. Accordingly approval of the shareholderswasobtained through postal ballot on 30" March 2019forcontinuation of Justice G ulab Gupta (87 years) and Mr. Mohan C Pant (81 years) as the NonExecutive Independent Directors of the Company after 31st March, 2019.

All the Independent Directors of the Company have given declarationsto the Company underSection 149(7)ofthe Actthat they meet the criteria of independence as provided under Section 149(6) ofthe Act and Regulation 16(1)(b) ofthe Listing Regulations In the opinion ofthe Board, they fulfil the conditionsof independence asspecified in the Actand the Listing Regulations and are independentofthe management.

In accordance with the provisions of Section 152 of the CompaniesAct, 2013, and Article 115ofthe ArticlesofAssociation ofthe Company, Mrs Drushti R. Desai (DIN 00294249) retires by rotation atthe ensuing AnnualGeneralMeeting ofthe Company and being eligible, has offered herself for re-appointment. The Board ofDirectorsrecom mend she rre-appointment.

Approval ofthe shareholderswasobtained in the AnnuaIG eneral Meeting forappointmentofMr. AshokK Kapur(DIN-00126807), as the Wholetime Directorof the Company fora period of 2years with effect from 1st June, 2019, on terms of remuneration as recommended by the Nomination & Remuneration Committee.

In terms of requirement of Listing Regulations the Board has identified core skills expertise and competenciesofthe Directors in the context of the Companys businesses for effective functioning, which are detailed in the Corporate Governance Report.

Attention of Shareholders is invited to the relevant items of the Notice ofthe AnnualGeneralMeeting and the Notesthereto. Brief resume ofthe Directors proposed to be reappointed, nature of their expertise in specific functional areas and names of companies in which they holds directorship and membership/ chairmanship of committees of the Board, as stipulated under Regulation 36ofthe Listing Regulationsare given in the section on Corporate G ovemance in thisAnnua I Report.

Directors Appointmentand Remuneration The policy ofthe Company isto have an appropriate numberof executive and independentdirectorson the board.The policy of the Company on directors; appointmentand remuneration, etc. as required underSection 178 of the CompaniesAct, 2013, is available on the website (www.narmadagelatinescom) and in the Corporate Governance Report. The remuneration paid to the directors is as per the terms laid down in the Nomination & Remuneration Policyofthe Company.

The Company hasa Nomination and Remuneration Committee which makes recommendation to the Board with regard to the appointment of new Directorsand Key Managerial Personnel. This policy on nomination and remuneration of Directors, Key Managerial Personnel and Senior Management has been formulated in termsofthe provisionsofthe CompaniesAct, 2013 and the Listing Regulations as amended from time to time and includes the general guidelines on the appointment and remuneration including criteria for determining qualifications positive attributes and independence of the Directors, Key Managerial Personnel and otheremployeesofthe company and othermattersprovided undersub-section (3)ofSection 178ofthe CompaniesAct, 2013.

The mainobjectivesofthe policyare:

• To laydown criteria and termsand conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in senior management and key managerial positionsand to determine theirremuneration.

• To determine remuneration based on the Companys size and financial position and trends and practices on remuneration prevailing in peer companies and in the industry.

• To carry out evaluation ofthe performance of Directors as wellaskey manage rial and seniormanagement personnel.

• To provide them reward linked directly to their effort, performance, dedication and achievement relating to the C om pa nysope rations

• To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.

Board Evaluation

The Nomination & Remuneration Committee and the Board have

laid down the manner in which a forma I annua I evaluation of the performance ofthe Board, Committees, Chairman and individual directorshasto be made. The Board ofDirectorshascarried outan annual evaluation of its own performance, Board committees and individual directors pursuant to the provisionsof the Act, SEBI Listing Regulationsand the Guidance Note on Board Evaluation issued bythe Securitiesand Exchange Board oflndia.

The Board evaluated its own performance 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 committeeswasevaluated bythe Board afterseeking inputsffom the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings etc.

In a separate meeting ofindependentdirectors the performance of non-independent directors and the Board as a whole was evaluated, taking into account the views of executive directors and non-executive directors

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directorson the basisof criteria such asthe contribution ofthe individual directorto the Board and Committee meetingslike preparednesson the issuesto be discussed, meaningful and constructive contribution and inputs in meetings etc. In the board meeting that followed the meeting ofthe independentdirectorsand meeting ofNomination and Remuneration Committee, the performance ofthe Board, its committees and individuaIdirectorswasaIso discussed.

Performance evaluation of independent directors wasdone by the entire Board, excluding the independent director being evaluated. The mannerin which the evaluation wascarried out is covered in the Corporate Governance Report.

Board Meetings

The Board meets at regular intervals to discuss and decide on companysbusinesspoliciesand strategies In case ofspecialand urgent business the Board/Committees approval is taken by passing resolutions through circulation, or by calling Board/Committee meetingsata shorter notice, aspermitted by law. The Company ha scorn plied with Sec re ta rial Stand a rdsissued by the Institute of Company Secretaries of India on Board meetings and Annual General Meetings The agenda for the Board and Committee meetings includes detailed noteson the itemsto be discussed to enable the Directorsto take an informed decision. During the financial year under review, four Board Meetings and four Audit Committee Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between two Meetings waswithin the period prescribed underthe CompaniesAct, 2013.

Directors Responsibility Statement

Pursuantto Section 134(5) ofthe Act, the Board of Directors to the bestofitsknowledge and ability,confirm that:

a. in the preparation ofthe annualfinancialstatementsforthe year ended March 31, 2020, the applicable accounting standards have been followed along with proper explanation relating to materialdepartures ifany;

b. appropriate accounting policieshave been selected and applied consistently and judgementsand estimates made are reasonable and prudentso asto give a trueand fairview ofthe state ofaffairsofthe Company asatMarch 31, 2020 and ofthe profitofthe Company forthe yearended on that date;

c. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisionsofthe CompaniesAct, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities

d. the annual financial statements have been prepared on a going concern basis

e. properintemal financial controls have been followed and thatsuchfinancialcontro Isa re adequate and are operating effectively; and

f propersystemsto ensure compliance with the provisionsof all applicable lawsare in place and were adequate and operating effectively.

Related Parly Transactions

All related party transactions that were entered into during the financial year were on arms length basis and were in the ordinary course of business There are no materially significant related party transactionsmade bythe Company with Promoters Directors Key Managerial Personnel orotherdesignated persons which may have a potential conflict with the interest ofthe Companyatlarge.

Particulars of contracts or arrangements with related parties referred to in Section 188(1) ofthe CompaniesAct, 2013 in Form A0C-2are setoutin the Note 36ofNotesto Financial Statements forming partofthe Annual Report. None ofthe Directorshave any pecuniary relationshipsortransactionswith the Company orvice versa.

Statutory Auditorsand Audit Report

Pursuantto the provisions of Section 139 ofthe Act read with Companies (Audit and Auditors) Rules 2014, as amended fiem time to time, M/s Lodha and Company, Mumbai, Chartered Accountants (Firm Registration No.301051E), were appointed as statutory auditorsofthe Company to hold office fora term offive yearsi.e. fiem the conclusion of 56th Annual GeneraI Meeting of the Company, till the conclusion of 61st Annual G enera I Meeting to be held in 2022. The Ministry of Corporate Affairs vide its Notification dated 7th May 2018, has dispensed with the requirement of ratification of Auditors appointment by the shareholders, every year. Hence, the resolution relating to ratification ofAuditofsappointmentisnotincluded in the Notice ofthe ensuing Annua IG enera I Meeting.

The Statutory Auditors M/s Lodha and Company, Mumbai, Chartered Accountants have submitted their Report on the FinancialStatementsofthe Company forthe financial year 201920, which formspartofthisAnnual Report. The Noteson Financial Statements referred to in the Auditors! Report forthe year2019-20 are self-explanatory. There are no observations qualifications reservationsoradverse remarksin the AuditorsReportthatcallfor anyexp la nation.

Secretarial Audit

Pursuantto the provisions of Section 204 of the CompaniesAct, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Dr. Asim Kumar C ha ttopadhyay, Company Secretary in Practice, wa sap pointed to undertake the Secretarial Audit ofthe Company. The Secretarial Audit Report isannexed to thisReportasAnnexure - II. The Secreta ria I Aud it Report does not conta in a ny q ua lifica tions reservationsoradverse remarks

Transferof Unpaid and Unclaimed amounts to IEPF Pursuantto the provisions of Section 124ofthe CompaniesAct, 2013, during the financial year, the declared dividends and

interestondebentureswhich remained unpaid orunclaimed fora period of 7yearshave been transferred by the Company to the InvestorEducation and Protection Fund (IEPF) established by the Central G ovemment, as detailed in the Corporate G ovemance Report.

The Company hasuploaded the detailsofunpaid and unclaimed amounts lying with the Company as on 25th September, 2019 (date of last Annual General Meeting) on the website of the Ministry ofC orpora te Affairs(www.iepfgov.in).

Significantand MaterialOrderpassed by the Regulators There are no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern statusand the Com pa nysoperationsin future.

Corporate Governance Report

The ReportonCorporateGovemanceasstipulated undertheSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 forms part of the Annual Report. The Whole-time Directors declaration regarding compliance with the CompanysCode of Business Conduct and Ethics for Directors and Management Personnel forms part of the Corporate Governance Report. As required by the Listing Regulations the certificate on Corporate Governance for the year ended 31st March, 2020 issued by Dr. Asim KumarChattopadhyay, Company Secretary in Practice, is annexed to thisReport.

ManagementDiscussion and Analysis

The Management Discussion and Analysis Report as required underthe Listing Regulations is presented in a separate section and formspartofthe AnnualReport.

Energy Conservation, Technology Absorption and Foreign Exchange Eamingsand Outgo

The particulars relating to energy conservation, technology absorption, foreign exchange eamingsand outgo, asrequired to be disclosed underSection 134(3)(m)ofthe CompaniesAct, 2013 read with Rule 8(3) of The Companies (Accounts) Rules 2014 is annexed to thisReportasAnnexure -III.

ExtractofAnnual Return

In accordance with the Section 134(3)(a) ofthe CompaniesAct, 2013, an extractofthe Annual Return in Form MGT-9isannexed to thisReportasAnnexure -IV.

Particulars of Employees

None of the employees of the Company is in receipt of remuneration exceeding the limits prescribed under Section 197(12)ofthe CompaniesAct, 2013read with Rules5(2)and 5(3) of The Companies (Appointment and Remuneration of Ma n a g e ria I Pe rso n ne 0 Ru le s 2014.

Disclosurespertaining to remuneration and otherdetailsin respect of directors and employees of the Company asrequired under Section 197(12) ofthe CompaniesAct, 2013read with Rule 5(1)of The Companies(Appointmentand Remuneration ofManagerial Personnel) Rules 2014isannexed to thisReportasAnnexure -V.

Disclosure underthe Sexual HarassmentofWomen atWorkplace (Prevention, Prohibition and Redressal) Act, 2013 All the employeesin the Companyare considered equal. There is no discrimination between individualsatany point on the basisof race, colour, gender, religion, origin, sexual orientation or age. Every individual is expected to treat his/her colleagues with respectand dignity.

The Company has in place a policy for prevention of sexual harassment at workplace. This Anti- Sexual Harassment Policy of the Company is in line with the requirements of The Sexual HarassmentofWomen atthe Workplace (Prevention, Prohibition & Redressal) Act, 2013. All employees (permanent, contractual, temporaryand trainees) a re covered underthispolicy. An Internal ComplaintsCommittee isin place to redresscomplaintsreceived regarding sexual harassment. No complaint wasreceived by the Companyduring the financialyearended 31stMarch, 2020.

Material changes and commitments affecting the financial position ofthe Company

There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end ofthe financialyearofthe Company to which the financial statements relate and the date of this report.

Appreciation

The Directors wish to convey theirdeep appreciation to all the employees customers, vendors, investors and consultants/ advisorsofthe Company fortheirsincere and dedicated services as well as their collective contribution to the Companys performance.

The Directorsalso thank the Centraland the State Governments statutory authorities bankers and businessassociatesand all the stakeholdersfortheircontinued interestand valued support.

Forand on behalfofthe Board
Mohan C Pant Ashok K. Kapur
Director Whole-time Director

Place: Jabalpur

Date: 29th June, 2020