Dear Members,
Your Directors are pleased to present the 45th Annual Report of Reliance
Chemotex Industries Ltd. ("the Company") along with the Audited Financial
Statements for the financial year ended on March 31, 2023.
FINANCIAL PERFORMANCE
The Companys Financial Summary and Highlights are summarized below:
(Rs. In Lacs)
| Particulars |
Financial Year 2022-23 |
Financial Year 2021-22 |
| Revenue from Operations |
36,487.78 |
36,177.23 |
| Other Income |
615.92 |
658.73 |
| Total Income |
37,103.70 |
36,835.96 |
| Earnings Before Depreciation, Interest and Tax
(EBIDTA) |
4,039.62 |
4,802.96 |
| Less: Depreciation |
975.69 |
852.98 |
| Less: Finance Cost |
1,393.18 |
1,214.85 |
| Profit Before Tax |
1,670.75 |
2,735.13 |
| Tax Expenses |
428.83 |
921.91 |
| Profit After Tax |
1,241.92 |
1,813.22 |
| Other Comprehensive Income |
5.00 |
41.15 |
| PAT after Other Comprehensive Income |
1,246.92 |
1,854.37 |
| Earnings Per Share (in Rs.) (Basic &
Diluted) |
16.46 |
24.04 |
OPERATIONAL PERFORMANCE
Despite the ongoing challenges encountered by the textile sector and industry at large
on both the global and domestic front, your Companys performance for the year under
review has been commendable. Your Company achieved a total income of
371.04 crores for FY 2023 as compared to 368.36 crores for FY 22. Your
Company reported a net profit of 12.42 crores for FY 2023 against a net
profit of 18.13 crores for the previous year.
The Companys export for the FY 2023 stood at 213.16 crores and the
Companys domestic sales grew from 99.51 crores to 144.89
crores.
DIVIDEND
The Company has a robust track record of rewarding its shareholders with a consistent
dividend payout. In view of the strong operational and financial performance during the
year under review, the Board of Directors is pleased to recommend a dividend of Rs. 2.5
per share (i.e. 25 %) for the financial year ended on March 31, 2023, subject to the
approval of shareholders at the ensuing Annual General Meeting. The total outflow towards
dividend, including tax deducted at source (TDS) on Equity Shares for the year would be
Rs. 1.89 Crores.
As per the prevailing provisions of the Income Tax Act, 1961, the dividend, if
declared, will be taxable in the hands of the shareholders at the applicable rates. For
details, shareholders are requested to refer to the Notice of Annual General Meeting.
CAPACITY EXPANSION
During the year under review, the Company embarked on an expansion project with a total
project cost of approximately 100 crores. This expansion will expand our capacity by
approximately 12,480 spindles, will focus on the modernization and expansion of our dyeing
facilities and will also add machinery to help debottleneck certain production processes.
The implementation of the project is progressing well and we envisage that it will be
completed during this financial year. This expansion will increase operational
efficiencies, reduce operating costs by taking further advantage of economies of scale,
improve profitability and expand our product offering.
CHANGES IN THE NATURE OF BUSINESS
There were no changes in the nature of business during the year under review as
prescribed in Rule 8 (5) (ii) of the Companies (Accounts) Rules, 2014. Your Company
continues to remain in the same business.
TRANSFER TO RESERVE
The Board of Directors has decided to retain the entire amount of profits for the
financial year 2022-23 in the profit and loss account and does not propose to transfer any
amount to the General Reserve of the Company.
SHARE CAPITAL
As on March 31, 2023, the authorised share capital of the Company is Rs. 43,75,00,000
comprising 1,35,00,000 equity shares of Rs. 10/- each and 30,25,000 preference shares of
Rs. 100/- each, and the paid-up equity share capital as at March 31, 2023 is Rs.
7,54,35,630 comprising of 75,43,563 equity shares of the face value of Rs. 10/- each.
During the financial year 2022-23, the Company has neither issued any shares, nor
instruments convertible into equity shares of the Company or with differential voting
rights, nor has it granted any stock options or sweat equity.
DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES / AND THEIR PERFORMANCE
During the year under review, the Company has no Subsidiaries/ Associate Companies /
Joint ventures.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments affecting the financial position of the
Company that have occurred between the end of the financial year on March 31, 2023 to
which the financial statements relate and the date of this report.
SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING
THE GOING CONCERN STATUS AND THE COMPANYS OPERATIONS IN FUTURE
There were no significant and material orders passed by the regulators, courts or
tribunals which would impact the going concern status of the Company and the Companys
future operations.
LOANS, GUARANTEES & INVESTMENTS BY THE COMPANY
During the year under review, the Company has not made any investments or given any
loans or guarantees or provided any security in connection with a loan to any person or
body corporate, as defined under Section 186 of the Companies Act 2013.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All Related Party Transactions that were entered into during the financial year under
review, were on an arms length basis, in the ordinary course of business and are in
compliance with the applicable provisions of the Act and the Listing Regulations. There
were no materially significant related party transactions that could have potential
conflict with the interest of the Company at large.
All Related Party Transactions are placed before the Audit Committee for prior
approval. Prior omnibus approval of the Audit Committee is obtained for transactions that
are repetitive in nature or when the need for these transactions cannot be foreseen in
advance.
Details of transactions with Related Parties as required under Section 134 (3) (h) of
the Act read with Rule 8 (2) of the Companies (Accounts) Rules, 2014 are given in Annexure
- 1 in Form AOC - 2 and forms part of this Report.
The Company has adopted a policy for dealing with Related Party Transactions. The
Policy as approved by the Board is available at the web link:
http://reliancechemotex.com/reports/code-of- conduct-and-policies/.
MEETINGS OF BOARD
The Board of Directors met four times during the year on May 25, 2022, August
11, 2022, November 09, 2022 and February 09, 2023. Frequency and quorum at these meetings
and the intervening gap between any two meetings were in conformity with the provisions of
the Act, the Listing Regulations and Secretarial Standards issued by the Institute of
Company Secretaries of India ("Secretarial Standards"). For further details,
please refer to the Report on Corporate Governance annexed to this report.
COMMITTEES OF THE BOARD OF DIRECTORS
As on March 31, 2023, the Board of Directors has the following committees:
• Audit Committee
• Nomination & Remuneration Committee
• Stakeholders Relationship Committee
• Finance Committee
The details of committees along with their composition, number of meetings, attendance
at the meetings and other details are provided in the Corporate Governance Report annexed
to this report.
The Board of Directors of the company dissolved the Corporate Social Responsibility
committee with effect from May 25, 2022.
CHANGE IN THE DIRECTORS AND KEY MANAGERIAL PERSONNEL
DIRECTORS
• In accordance with the provisions of the Act and the Articles of Association
of the Company, Mr. Sanjiv Shroff (DIN: 00296008) Executive Director, Managing Director
and Mrs. Dipika Shroff (DIN: 00226941) Non-Executive & Non-Independent Director of the
Company were liable to retire by rotation at the 44th Annual General Meeting
and were re-appointed by the members.
• In accordance with the provisions of the Act and the Articles of Association of
the Company, Mr. Nand Gopal Khaitan (DIN: 00020588), Non-Executive & Non Independent
Director and Mr. Rahul Shroff (DIN: 02301693), Whole Time Director and designated as
Executive Director of the Company are liable to retire by rotation at the ensuing Annual
General Meeting and being eligible have offered themselves for re-appointment. The Board
of Directors recommends their re-appointment.
• Mr. Ameya Shroff (DIN:05315616) was re-appointed as Whole Time Director and
designated as Executive Director of the Company for the further period of 3 (Three) years
w.e.f. August 01, 2022 to July 31, 2025 at the 44th AGM of the Company.
KEY MANAGERIAL PERSONNEL
Mr. Utkarsh Gaur has been appointed as Company Secretary & Compliance Officer
w.e.f. May 25, 2022.
Except as stated above, there were no other changes in the Directors and Key Managerial
Personnel of the Company during the year under review.
DECLARATION BY INDEPENDENT DIRECTORS
Pursuant to Section 149 of the Act and Regulation 16 of the Listing Regulations, all
independent directors of the Company have given a declaration that they meet the criteria
of Independence and are also registered with the IICA databank of independent directors.
The Exemption certificate has been received from all the independent directors for
not-appearing in the Exam conducted by IICA.
The Independent Directors have also confirmed that they have complied with the
Companys code of conduct. In the opinion of the Board of Directors, the independent
directors fulfill the conditions specified in the Act and the Listing Regulations and are
independent of the management.
Further, a familiarization program has been conducted for Independent Directors and the
details are uploaded on the company website https://www.reliancechemotex.com/reports/
grievance-management/.
FORMAL ANNUAL EVALUATION
The Board of Directors has carried out an annual evaluation of its own performance, and
the performance of 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, the
effectiveness of board processes, the 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, the
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, the performance of non-independent directors, the Board as a whole,
and the Chairman of the Company were 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 directors on the basis of criteria such as the contribution of the individual
director to the board and committee meetings based on their 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.
AUDITORS AND AUDIT REPORTS
STATUTORY AUDITORS AND AUDIT REPORT
M/s Jain Pramod Jain & Co, Chartered Accountants (Firm Registration No.: 016746N)
was re-appointed as Statutory Auditors of your Company at the 44th Annual
General Meeting held on September 27, 2022, for the second term of five consecutive years
commencing from the conclusion of the 44th AGM until the conclusion of the 49th
AGM to be held in the year 2027. The Auditors had confirmed that they were not
disqualified from being re-appointed as Auditors of the Company.
The Statutory Auditors Report for the financial year 2022-23 on the financial statement
of the Company forms part of this Annual Report. The Auditors have expressed their
unmodified opinion on the Financial Statements and their reports do not contain any
qualifications, reservations, adverse remarks, or disclaimers. The information referred to
in the Auditors Report is self-explanatory and does not call for any further comments.
The Statutory Auditors of the Company have not reported any fraud as specified under
Section 143 (12) of the Act, in the year under review.
COST AUDITORS AND COST AUDIT REPORT
M/s. N. N. & Associates, Cost Accountants (Firm Registration No.: 002322), were
reappointed as Cost Auditors of the Company for conducting the Cost Audit for the
financial year 2022-23. The Cost audit report for the financial year 2022-23 does not
contain any qualifications, reservations, adverse remarks, or disclaimers. The information
referred to in the Auditors Report is self-explanatory and does not call for any further
comments.
In terms of the provisions of Section 148 of the Companies Act,
2013, read with Companies (Cost Records and Audit) Rules,
2014, as amended from time to time, the Board of Directors of the company at their
meeting held on May 26, 2023 has, on the recommendation of the Audit Committee, approved
the reappointment of M/s. N. N. & Associates, Cost Accountants (Firm Registration No.
002322), as the Cost Auditors, to conduct the Cost Audit for the financial year 2023-24. A
resolution seeking approval of the Shareholders for ratifying the remuneration payable to
the Cost Auditors for the financial year 2023-24 is provided in the Notice of the ensuing
Annual General Meeting.
The Cost accounts and records as required to be maintained under section 148 (1) of the
Act are duly made and maintained by the Company.
During the financial year 2022-23, no fraud was reported by the Cost Auditors of the
Company in their Audit Report.
SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT
M/s. V. M. & Associates, Company Secretaries (Firm Registration No.:
P1984RJ039200), were reappointed as Secretarial Auditors of the Company for conducting the
Secretarial Audit for the financial year 2022-23. The Secretarial Audit Report for the
financial year 2022-23, in form MR-3, does not contain any qualifications, reservations or
adverse remarks and is annexed to this report as Annexure - 2.
During the financial year 2022-23, no fraud was reported by the Secretarial Auditors of
the Company in their Audit Report.
INTERNAL AUDITORS AND INTERNAL AUDIT REPORT
M/s. Rajeev Amitabh & Co, Chartered Accountants (Firm Registration No.: 009942N)
were re-appointed as Internal Auditors of the Company for conducting an Internal Audit for
the financial year 2022-23. The Internal Audit Reports were received by the Company and
the same were reviewed by the Audit Committee and taken note of by the Board of Directors
of the company.
The Internal Audit Report for the financial year 2022-23 does not contain any
qualifications, reservations, adverse remarks, or disclaimers. The information referred to
in the Auditors Report is self-explanatory and does not call for any further comments.
Further, the Board of Directors has approved the re-appointment of M/s. Rajeev Amitabh
& Co, Chartered Accountants (Firm Registration No.: 009942N) as Internal Auditors at
their meeting held on May 26, 2023 for conducting the Internal Audit of the Company for
the financial year 2023-24.
During the financial year 2022-23, no fraud was reported by the Internal Auditors of
the Company in their Audit Report.
VIGIL MECHANISM /WHISTLE BLOWER POLICY
Your Company is committed to the highest standards of ethical, moral and legal business
conduct. Accordingly, the Board of Directors has formulated a Whistle Blower Policy which
is in compliance with the provisions of Section 177 (9) of the Act and Listing
Regulations. The policy provides a framework and process whereby concerns can be raised by
its employees against any kind of discrimination, harassment, victimization or any other
unfair practice being adopted against them, and can also report these directly to the
Chairperson of the Audit Committee. The policy focuses on promoting ethical behavior in
all its business activities and encourages employees to report concerns and unethical
behavior, actual or suspected fraud or violation of the companys code of conduct and
ethics. Under the said mechanism, employees are free to report violations of applicable
laws and regulations and the Code of Conduct. It also provides adequate safeguards against
the victimization of persons who use this mechanism. The Vigil Mechanism/Whistle Blower
Policy has been posted on the Companys website at https://www.reliancechemotex.com/
reports/code-of-conduct-and-policies/. The functioning of the
Vigil Mechanism is reviewed by the Audit Committee from time to time. The Company
affirms that no director/employee has been denied access to the Chairperson of the Audit
Committee and that no complaint was received during the year.
CORPORATE SOCIAL RESPONSIBILITY
The Company has a Policy on Corporate Social Responsibility and the same has been
posted on the website of the Company at
https://www.reliancechemotex.com/reports/code-of-conduct- and-policies/.
As required under Section 134 (3) (o) of the Companies Act, 2013 and Rule 9 of the
Companies (Corporate Social Responsibility Policy) Rules, 2014, the Annual Report on CSR
activities, is annexed as Annexure - 3, which forms part of this Report.
RISK MANAGEMENT POLICY
The Company has adopted measures concerning the development and implementation of a
Risk Management System in terms of Section 134(3)(n) of the Companies Act, 2013 and in
line with the Risk Management Policy of the Company, after identifying the elements of
risks which, in the opinion of the Board, may threaten the very existence of the Company
itself. The Company has an elaborate process of identification, assessment and
prioritization of risk followed by coordinated efforts to minimize, monitor and
mitigate/control the probability and/or impact of unfortunate events or to maximize the
realization of opportunities.
The Risk Management procedure is reviewed by the Board from time to time, to ensure
that the executive management controls risks through means of a properly defined
framework. Major risks identified are systematically addressed through mitigating actions
on a continuing basis.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013
The Company has always believed in providing a safe and harassment-free workplace for
every individual through various interventions and practices. The Company always endeavors
to create and provide an environment that is free from discrimination and harassment,
including sexual harassment.
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements
of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal)
Act, 2013. The Internal Complaints Committee (ICC) has been set up in compliance with the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
to redress complaints received regarding sexual harassment. All employees (permanent,
contractual, temporary, trainees) are covered under this policy.
Following are the details of sexual harassment cases for the financial year 2022-23.
| S. No. |
No. of complaints received during the
financial year |
No. of complaints disposed of during the Year |
No. of Complaints pending as at the end of the financial year
|
|
NIL |
NIL |
Nil |
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
http://www.reliancechemotex.com/reports/ financial-reports/.
FIXED DEPOSITS
During the Financial Year 2022-23, your Company has not invited, accepted or renewed
any deposits within the meaning of Sections 73, 74 and 76 of the Act read together with
the Companies (Acceptance of Deposits) Rules, 2014.
The Borrowings taken from the Directors have been stated in the financial statements
note no.16.
INTERNAL FINANCIAL CONTROL SYSTEM
For a detailed discussion with reference to the adequacy of internal financial
controls, please refer to Management Discussion and Analysis Report annexed to this report
as Annexure -7.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information pertaining to the conservation of energy, technology absorption,
Foreign Exchange Earnings and outgo as required under Section 134 (3) (m) of the Companies
Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 is marked as Annexure
- 4 to this report.
NOMINATION & REMUNERATION POLICY
The Board of Directors has framed the policy on Nomination & Remuneration which
lays down the framework in relation to the selection, appointment and remuneration of
Directors, Key Managerial Person and Senior Management of the Company. The Nomination
& Remuneration Policy has been posted on the Companys website https://www.
reliancechemotex.com/reports/code-of-conduct-and-policies/ and the salient features of the
policy form a part of the Annual report.
PARTICULARS OF EMPLOYEES & THEIR DISCLOSURES
Disclosures pursuant to Section 197 (12) of the Act, read with Rule 5 (1) of Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this
Report as Annexure - 5.
Further, disclosures pursuant to Rule 5 (2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is annexed to this Report as Annexure
- 6.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report for the financial year 2022-23, as
stipulated under the Listing Regulations is annexed to this report as Annexure - 7.
REPORT ON CORPORATE GOVERNANCE
The Company has complied with the Corporate Governance requirements under the
provisions of the Act and the Listing Regulations. The Report on Corporate Governance for
the financial year 2022-23 is annexed to this report as Annexure - 8.
DISCLOSURE OF ACCOUNTING TREATMENT IN PREPARATION OF FINANCIAL STATEMENTS
The financial statements are prepared in accordance with Indian Accounting Standards
(Ind AS). The IND AS are prescribed under section 133 of the Act, read with rule 3 of the
Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting
Standards) Amendment Rules, 2016. Accounting Policies have been consistently applied
except where a newly issued accounting standard is initially adopted or a revision to an
existing accounting standard requires a change in the accounting policy hitherto in use.
SECRETARIAL STANDARDS
The Company has complied with the applicable provisions of the Secretarial Standards
issued by the Institute of Companies Secretaries of India and notified by the Ministry of
Corporate Affairs.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 (5) of the Companies Act, 2013, the Directors, to the best of
their knowledge and belief, confirm that:
• In the preparation of the annual accounts for the Financial Year ended March 31,
2023, the applicable accounting standards have been followed and there are no material
departures;
• 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 of the Company for that period;
• They have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
• They have prepared the Annual Accounts for the Financial Year ended March 31,
2023 on a going concern basis;
• They have laid down internal financial controls to be followed by the Company
and such internal financial controls are adequate and operating effectively;
• They have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND
BANKRUPTCY CODE, 2016
No application has been made under the Insolvency and Bankruptcy Code; hence the
requirement to disclose the details of an application made or any proceeding pending under
the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their
status as at the end of the financial year is not applicable.
OTHER DISCLOSURES
Other disclosures with respect to Boards Report as required under the Act read with
rules notified thereunder and listing regulations and other SEBI regulations are either
NIL OR NOT APPLICABLE.
CAUTION STATEMENT
Statements in the Boards Report and the Management Discussion and Analysis describing
the Companys objectives, expectations or predictions may be forward-looking within the
meaning of applicable securities laws and regulations. Actual results may differ
materially from those expressed in the statement. Crucial factors that could influence the
Companys operations include global and domestic demand and supply conditions affecting
selling
prices, new capacity additions, availability of critical materials and their cost,
changes in government policies and tax laws, economic development of the country and other
factors that are material to the business operations of the Company.
APPRECIATIONS AND ACKNOWLEDGEMENTS
Your Directors place on record their deep appreciation to every member of the Reliance
family for their hard work, dedication and commitment, to whom the credit for the
Companys achievements goes. Your Directors would also like to acknowledge the valuable
contribution of the Companys Promoters to the continuous improvement in our Business
Practices.
Your Company looks upon its suppliers, distributors, retailers, business partners and
others associated with it in its progress and the Board places on record its appreciation
for the support and co-operation from all of them. The Directors take this opportunity to
express their deep sense of gratitude to the Banks, Government and Regulatory authorities,
both at the Central and the State levels for their continued guidance and support.
And to you, our shareholders, we are deeply grateful for the confidence and faith that
you have always reposed in us.
For and on behalf of the Board of Reliance Chemotex Industries Ltd.
|
Sanjiv Shroff |
Ameya Shroff |
| Place: Mumbai |
Managing Director |
Whole Time Director |
| Date: May 26, 2023 |
DIN: 00296008 |
DIN: 05315616 |
+91-9892691696
