iifl-logo-icon 1

Nitin Spinners Ltd Directors Report

Jul 19, 2024|09:44:55 AM

Nitin Spinners Ltd Share Price directors Report


The Members

Your Directors have pleasure to present the 31st Annual Report on the business and operations of your Company along with the Audited Financial Statements for the year ended 31st March, 2023.


The Financial Results of the Companys performance for the year under review and those of the previous year are as follows: -

Particulars Current Year Previous Year
2022-23 2021-22
Revenue From Operations 2406.71 2692.32
Gross Profit Before Finance Cost, Depreciation & Exceptional item 300.37 653.45
Finance Cost 37.68 55.34
Profit before Depreciation, Exceptional items and Tax 262.69 598.11
Depreciation 86.81 87.40
Exceptional items - 4.54
Profit before Taxation 175.88 506.17
Provision for Taxation - Current Tax 43.33 167.74
- Deferred Tax (32.27) 12.29
Profit after Tax 164.81 326.14
Other Comprehensive Income/(Loss) net of Income Tax 2.34 3.19
Total Comprehensive Income for the period 167.15 329.33



The year under review was very difficult year for the Indian Cotton Textiles Industry as it faced multiple challenges during the year: (1) Very high price volatility and higher absolute prices of Raw Materials (2) relative domestic price difference compared to international prices resulting in competitive disadvantage in International Markets and (3) demand slowdown due to geopolitical tensions, inflation in European and US economies. Due to all these factors, the Spinning Mills in India have to cut down capacity utilization. Your company has also cut production by about 14% of annual capacity during second and third quarters of the year to avoid heavy losses amid extreme volatility.

Despite above factors, your company achieved Revenue from Operations of Rs. 2406.71 Crores against Rs. 2692.32 Crores in the previous year, registering reduction of 10.60%, which was mainly due to reduction in production. The revenue of Yarn reduced by 15.16% during current year from Rs. 1878.43 Crores in previous year to Rs. 1593.59 Crores. The revenue from Yarn constitutes 66.21% of the total revenue. Revenue of Fabric has reduced from Rs. 679.52 Crores in the previous year to Rs. 654.42 Crores during year under review and registered reduction of 3.69%. The Fabric revenue constitutes 27.19% of the total revenue from operations.


The volatility in cotton prices and subdued demand of cotton yarn in overseas market also affected exports of the Company and it decreased to Rs. 1356.33 Crores in the current year from Rs. 1953.63 Crores in the previous year registering reduction of 30.57%. The Exports constituted 56.36% of the total revenue during the year.


As a result of lower capacity utilization; the profitability of the Company has also been adversely affected and Operating Profit (EBIDTA) and it has substantially reduced from Rs. 653.45 Crores in the previous year to Rs. 300.37 Crores in current year. The Company has reported Net Profit of Rs. 164.81 Crores in the current year against Rs. 326.14 Crores in the previous year.


. Your Directors are pleased to recommend final Dividend of 25% i.e. Rs. 2.50 per Equity Shares on the fully paid-up Equity Share of Rs. 10/- each for the financial year 2022-23 subject to approval of shareholders at the ensuing Annual General Meeting. Accordingly, total outflow towards dividend on Equity Shares for the year under review would be Rs. 14.06 crores. In terms of provisions of Income Tax Act, 1961, payment of Dividend shall be subject to deduction of Tax at source.

The Board continues to support a steady dividend policy and the recommended dividend in accordance with the Dividend Distribution Policy of the Company which is available on website of the Company at link:https:// nitinspinners.com/wp-content/uploads/2021/10/ Dividend-Distribution-Policy.pdf


The Board of Directors has decided to retain the entire amount of profits for FY 2022-23 in the profit and loss account and no amount is proposed to be transferred to reserves.


The Company has undertaken expansion projects at estimated project cost of Rs. 955 Crores at both the Plants located at Hamirgarh (Bhilwara District) and Bhanwaria Kalan (Chittorgarh District). The commercial production of Weaving & Knitting capacity was commenced w.e.f. 31.03.2023. The implementation of expansion of Spinning

& Finishing capacity is under process and commercial production is expected to be commenced during current financial year.


The Companys vision on CSR is that the Company being a responsible Corporate Citizen would continue to make a serious endeavor for improvement in quality of life and betterment of society through its CSR related initiatives in the local areas where it operate.

During the current year, the Company has incurred expenditure of Rs. 434.08 Lakhs on CSR activities against obligation of Rs. 431.62 Lakhs. The excess spending of Rs 2.46 Lakhs shall be carried forward for set off in the next F.Y. 2023-24. The Annual Report on CSR Activities pursuant to Section 135 of the Companies Act, 2013 read with Rule 8 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure – I hereto and form part of this report.


Shri Ratan Lal Nolkha, Director of the Company who retired and being eligible, was re-appointed and his designation was changed from Executive Chairman to Non-Executive Chairman w.e.f. 01.10.2022.

Shri Dinesh Nolkha was re-appointed as Managing Director for five years w.e.f. 01.10.2022.

Shri Rohit Swadheen Mehta, was appointed as Independent Director for five years w.e.f. 30.12.2021 at the Annual General Meeting held on 15.09.2022.

No other changes have taken place in composition of Board of Directors and Key Managerial Personnel of the Company during the year under review.

Shri Nitin Nolakha, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment. On recommendation of Nomination and Remuneration Committee, the Board recommends his re-appointment for consideration of members of the Company at the ensuing Annual General Meeting.

The Company has received declarations from all the Independent Directors under Section 149(7) of the Companies Act, 2013 and Regulations 25(8) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as ‘Listing Regulations) confirming that they meet the criteria of independence as prescribed thereunder. The Independent Directors have complied with the Code for Independent Directors prescribed under Schedule IV of the Companies Act, 2013 and the Listing Regulations. The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience (including proficiency) and expertise and they hold highest standards of integrity. Further, Independent Directors fulfill the conditions of appointment as specified in the Listing Regulations and are Independent of the Management. The names of Independent Directors are included in Independent Directors data bank maintained with the Indian Institute of Corporate Affairs (‘IICA) in terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment & Qualification of Directors) Rules, 2014, as amended.

None of the Directors are disqualified for being appointed as Director as specified in Section 164(1) & (2) of the Act and Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

All the Directors, Key Managerial Personnel and Senior Management Personnel have confirmed compliance of "Code of Conduct for Directors and Senior Management Personnel". A declaration by the Managing Director in this regard is enclosed to this Report.



M/s Kalani & Co., Chartered Accountants (Firm Registration No. 000722C) were appointed Statutory Auditors at the 30th

Annual General Meeting held on 15th September, 2022 for five years till the conclusion of 35th Annual General Meeting to be held in the calendar year 2027. Accordingly, they have conducted Statutory Audit for the F.Y. 2022-23 and shall continue to be Statutory Auditors for the Financial Year 2023-24. They have confirmed their eligibility to continue as Statutory Auditors of the Company for the F.Y. 2023-24 under section 141 of the Companies Act, 2013 and rules framed there under.

The Audit Report on the Financial Statements for the Financial Year ended on 31st March, 2023, issued by M/s Kalani & Co., Chartered Accountants, is unmodified and do not contain any qualifications, reservations or adverse remarks. The information referred in Auditors Report are self explanatory and hence do not require any further clarification.


The Board of Directors has appointed M/s. V. M. & Associates, Company Secretaries (Firm Registration No. P1984RJ039200), to conduct Secretarial Audit for the Financial Year 2022-23 under the provisions of Section 204 of the Companies Act, 2013. Accordingly, they have conducted Secretarial Audit for the Financial Year 2022-23 and Secretarial Audit Report in Form MR-3 is enclosed herewith. Pursuant to provisions of Regulation 24A of Listing Regulations the Secretarial Auditors have also issued Annual Secretarial Compliance Report for the F.Y. 2022-23. Both the reports do not contain any qualification, reservation or adverse remark.

The Board of Directors on recommendation of Audit Committee has re-appointed M/s V. M. & Associates, Company Secretaries (Firm Registration No. P1984RJ039200) to conduct Secretarial Audit for the Financial Year 2023-24 under the provisions of Section 204 of the Companies Act, 2013. They have confirmed their eligibility for the said re-appointment.


The Company is required to maintain cost records, as specified by the Central Government, in terms of Section 148(1) of the Companies Act, 2013 and the rules framed there under, accordingly, the Company has maintained such cost records.

The Board of Directors on recommendation of Audit Committee has appointed M/s. Vivek Laddha & Associates, Cost Accountants (Firm Registration No. 103465) to conduct Cost Audit of the Cost Records maintained by the Company for the Financial Year 2022-23. Accordingly, they have conducted Cost Audit for the Financial Year 2022-23 and their report does not contain any qualification, reservation or adverse remark.

Pursuant to Section 148 of the Companies Act, 2013, your Directors have re-appointed M/s. Vivek Laddha

& Associates, Cost Accountants (Firm Registration No. 103465) to conduct Cost Audit of Cost Records of the Company for the Financial Year 2023-2024. They have confirmed their eligibility for the said re-appointment. The remuneration of Cost Auditors is proposed to be ratified by the Shareholders at the ensuing Annual General Meeting.


Pursuant to the provisions of Section 138 of the Companies Act, 2013 and The Companies (Accounts) Rules, 2014, Mr. Ankit Jain, Manager (Internal Auditor) of the Company has conducted internal audit of your Company for the financial year 2022-23.


During the year under review, the Statutory Auditors, Cost Auditors, Internal Auditors and Secretarial Auditors have not reported any instances of frauds committed in the Company by its officers or employees under Section 143(12) of the Companies Act, 2013.


The Company is committed to maintain the high standards of Corporate Governance and adhere to the requirements set out in Companies Act, 2013 and Listing Regulations. Pursuant to regulation 34(3) of the Listing Regulations, the Reports on Corporate Governance and Management Discussions & Analysis have been incorporated in the Annual Report and form an integral part of the Boards Report. A Certificate from Statutory Auditors confirming compliance to conditions of Corporate Governance as stipulated under Listing Regulations forms part of this Annual Report.


Your Company has been conferred with the following awards and recognition during the year under review:-

1. Award by the Government of Rajasthan for Highest Exports and highest growth in exports during FY 2020-21

2. Rajasthan Energy Conservation Award 2022- "1st Award" for the efforts in Energy conservation, under the Textile (Spinning) Category.


Industrial relations continued to be cordial during the period under review. Your Company firmly believes that a dedicated work force constitutes the primary source of sustainable competitive advantage. Accordingly, human resource development received focused attention. The Company has in house skill training centre and imparts on the job training to its manpower on continuous basis.

Your Directors wish to place on record their appreciation for the dedicated services rendered by the work force during the year under review.


Your Directors inform the members that the Company continuously looks out for energy conservation measures in all areas of operations across its both the Units. Similarly, your Company endeavors to lookout for up-gradation and absorption of technology. Your Company also spends continuously on research and development. Your Directors are glad to inform the members that your Company is a net foreign exchange earner. The relevant details as required to be disclosed with respect to Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo pursuant to Section 134(3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 are given in Annexure – II and forms integral part of this Report.


During the year 2022-23, the Board of Directors met four times on 12.05.2022, 06.08.2022, 08.11.2022 and 02.02.2023. The details of number of Board Meetings and the attendance of the Directors are provided in the Corporate Governance Report forming part of the Boards Report. The frequency and intervening gap between the meetings was within the period prescribed under the Companies Act, 2013, Listing Regulations and Secretarial Standards-1 issued by Institute of Company Secretaries of India (ICSI).


The Company has constituted Audit Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee and Corporate Social Responsibility Committee. The details of the committees have been given in the Corporate Governance Report which is integral part of the Boards Report. All the recommendation of the Audit Committee was accepted by the Board. No employee was denied access to the Audit Committee.


All the related party transactions are entered on arms length basis and in the ordinary course of business. The

Company has complied with all the applicable provisions of the Companies Act, 2013 and Listing Regulations in this regard. There were no transactions requiring disclosure under Section 134(3)(h) of the Act. Hence, the prescribed Form AOC–2 does not form a part of this Annual Report.

During the period under review, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the Policy on Materiality of and Dealing with Related Party Transactions. The related party disclosures are provided in the notes to financial statements. The Policy on Related Party transactions is available at the website of the Company under the link https://nitinspinners.com/wp-content/uploads/2022/01/ Related-Party-Policy.pdf


During the year under review, the Company has neither given any Loan, Guarantee or provided security in connection with a loan nor has made any Investments under Section 186 of the Companies Act, 2013.


During the period under review, your Company has not accepted any public deposit within the meaning of provisions of section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 and there is no outstanding deposit due for re-payment.


In pursuance of Section 177 (9) of the Companies Act, 2013 and the regulation 22 of the Listing Regulations and with the objective of pursuing the business in a fair and transparent manner by adopting the highest standards of professionalism, honesty, integrity and ethical behavior and to encourage and protect the employees who wish to raise and report their genuine concerns about any unethical behavior, actual or suspected fraud or violation of Companys Code of Conduct, the Company has adopted a Whistle Blower Policy. The policy has been disclosed on the website of the Company under the link https:// nitinspinners.com/wp-content/uploads/2023/02/Vigil-Mechanism.pdf

During the year under review, there was no instance of fraud and no whistle blower event was reported.


Pursuant to provisions of Section 178 of the Companies Act, 2013 and Listing Regulations the Board of Directors have approved Nomination, Remuneration & Evaluation Policy prescribing inter-alia the criteria for appointment, remuneration&evaluationoftheDirectors.TheNomination and Remuneration Committee and Board reviewed the performance of Board, its committee and all Individual Directors of the Company and expressed its satisfaction over the performance of them. The Independent Directors in their separate meeting have reviewed the performance of non-independent directors, Chairperson and Board as a whole along with review of quality, quantity and timeliness of flow of information between Board and management and expressed their satisfaction over the same. The Nomination, Remuneration & Evaluation Policy is available under the link https://nitinspinners.com/wp-content/ uploads/2021/07/Nomination-Remuneration-Policy.pdf During the year no amendment was made in the Policy.

In terms of provisions of section 178(4) of the Companies Act, 2013 the Salient features of the Policy are given Corporate Governance Report.


The Company has adopted a Risk Management Policy with the objective of ensuring sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business. The detailed Risk Management framework has been provided in the Management Discussion and Analysis Report of the Company. The Policy is available under the link https://nitinspinners.com/wp-content/ uploads/2021/10/Risk-Management-Policy.pdf


The information about employees and analysis of remuneration as required under Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are enclosed as Annexure - III


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 https://nitinspinners.com/wp-content/uploads/2023/07/MGT-7-2022-23.pdf


The Company has laid down Internal Financial Controls that include a risk-based framework to ensure orderly and efficient conduct of its business, safeguarding of its assets, accuracy and completeness of the accounting records and assurance on reliability of financial information. The

Company maintains adequate and effective internal control systems commensurate with its size and complexity. An independent internal audit function is an important element of the Companys internal control systems. This is executed through an extensive internal audit programme and periodic review by the management and the Audit Committee.

The Audit Committee has satisfied itself on the adequacy and effectiveness of the internal financial control systems laid down by the management. The Statutory Auditors have confirmed the adequacy of the internal financial control systems over financial reporting.


The Company has in place a Policy for prevention of sexual harassment and constituted internal complaints committee in line with the requirements of the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to redress complaints regarding sexual harassment at workplace. The committee has informed that during the year it has not received any complaint under the said Act, no complaint was pending at the beginning of the year and no complaint was pending at the end of year under review.


Pursuant to Regulation 34(2)(f) of the Listing Regulations the Business Responsibility and Sustainability Report for the financial year ended 31st March, 2023 is attached herewith and forms part of the report.


There are no material changes and commitments affecting the financial position of the Company which has occurred between the end of the financial year and the date of the report.

There is no change in the nature of business of the Company during the year under review.

The Company has complied with all the applicable Secretarial standards issued by the Institute of Company Secretaries of India.

The Company does not have any subsidiary, joint venture & associate company.

No significant and material order has been passed during the year by the regulators or courts or tribunals which can impact the going concern status and Companys operations in future.

No unclaimed dividend or shares are due for transfer to Investor Education & Protection Fund (IPEF) in terms of provisions of Companies Act, 2013. The year wise details of Unclaimed/Unpaid Dividend are available at the website of the Company under link https://nitinspinners.com/ unclaimed-and-unpaid-amounts/

The paid-up Equity Share Capital as on March 31, 2023 was Rs. 56.22 crore and there was no change in the Share Capital of the Company during the Financial Year 2022-23.

The detail of Credit Rating and Familiarization Programs has been given in Corporate Governance Report.

No application is made and no proceeding is pending against the Company under the Insolvency and Bankruptcy Code, 2016 (IBC Code) and there is no instance of one-time settlement of the Company with any bank or financial institution.

Certain disclosures are common under Companies Act, 2013 and Listing Regulations and the same are disclosed in the Corporate Governance Report forming part of this Report.

The disclosures other than made above are either nil or not applicable on the Company.


Pursuanttosub-section3(c)ofSection134oftheCompanies Act, 2013, the Board of Directors of the Company hereby state and confirm that:

(i) in the preparation of Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(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 affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period;

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventinganddetectingfraudsandotherirregularities,

(iv) they have prepared the Annual Accounts 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; and

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


Your Directors take this opportunity to thank all stakeholders including Members, Bankers, Business Partners/Associates, Central and State Governments for their consistent support and co-operation extended to the Company. We also acknowledge the significant contribution made by the employees by their dedication and hard work and trust reposed on us. We look forward to have the same support in our endeavor to help the Company to grow faster.

For and on Behalf of the Board of Directors

Dinesh Nolkha Nitin Nolakha
Place: Hamirgarh, Bhilwara Managing Director Joint Managing Director
Date: 05th August, 2023 (DIN – 00054658) (DIN – 00054707)
Registered Office :
16-17 KM Stone, Chittor Road,
Hamirgarh, Bhilwara - 311025

Knowledge Centerplus

Logo IIFL Customer Care Number
1860-267-3000 / 7039-050-000

Logo IIFL Securities Support WhatsApp Number
+91 9892691696

Download The App Now

Knowledge Centerplus

Follow us on


2024, IIFL Securities Ltd. All Rights Reserved

  • Prevent Unauthorized Transactions in your demat / trading account Update your Mobile Number/ email Id with your stock broker / Depository Participant. Receive information of your transactions directly from Exchanges on your mobile / email at the end of day and alerts on your registered mobile for all debits and other important transactions in your demat account directly from NSDL/ CDSL on the same day." - Issued in the interest of investors.
  • KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (broker, DP, Mutual Fund etc.), you need not undergo the same process again when you approach another intermediary.
  • No need to issue cheques by investors while subscribing to IPO. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries for refund as the money remains in investor's account."

www.indiainfoline.com is part of the IIFL Group, a leading financial services player and a diversified NBFC. The site provides comprehensive and real time information on Indian corporates, sectors, financial markets and economy. On the site we feature industry and political leaders, entrepreneurs, and trend setters. The research, personal finance and market tutorial sections are widely followed by students, academia, corporates and investors among others.

  • 9 out of 10 individual traders in equity Futures and Options Segment, incurred net losses.
  • On an average, loss makers registered net trading loss close to Rs. 50,000.
  • Over and above the net trading losses incurred, loss makers expended an additional 28% of net trading losses as transaction costs.
  • Those making net trading profits, incurred between 15% to 50% of such profits as transaction cost.
Copyright © IIFL Securities Ltd. All rights Reserved.

Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248

We are ISO 27001:2013 Certified.

This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.