TCPL Packaging Ltd Directors Report.

To,

The Members,

Your Directors have pleasure in submitting the Thirty First Annual Report along with Audited Financial Statement for the Financial Year ended on 31.03.2019.

FINANCIAL RESULTS

Your Companys performance during the Financial Year 2018-19 is summarized below:

(Rs. in Lakhs)
Particulars Year Year
2018-19 2017-18
Sales (Net of Excise Duty) 79610.14 67984.06
% Increase over previous year 17.10 14.07
Other Income 2103.13 2081.14
Net Sales including Other Income 81713.27 70065.20
EBIDTA 10572.90 8769.67
EBIDTA % of Net Sales 13.28 12.90
From which have been deducted:
Interest / Finance Charges 2832.44 2545.39
Leaving a cash profit of 7740.46 6224.28
Depreciation 3572.26 3512.98
Profit Before Tax 4168.20 2711.30
Provision for Tax 1145.00 580.28
Provision for Deferred Taxation 127.89 109.32
Profit After Tax 2895.31 2021.69
Other Comprehensive Income 5.70 -22.12
Leaving a balance of 2901.00 1999.59

DIVIDEND

As per the dividend policy adopted by your company, Directors recommend a dividend of Rs. 5.25 per Equity Share as against Rs. 3.70 recommended in the previous year. The payout on account of dividend and tax thereon amounts to Rs. 575.93 Lakhs. This corresponds to 19.89 % of the profit for the year 2018-19. This amount shall be accounted in the year 2019-20 subject to approval by members in the ensuing Annual General Meeting of the Company.

WORKING REVIEW

During the year 2018-19, the sales of your Company has increased to Rs. 796.10 crores from Rs. 679.84 crores for the previous year ended 2017-18 representing a healthy growth of 17.10 % as against growth of 14.07 % during the previous year 2017-18. The EBIDTA as a percentage of sales, has marginally improved to 13.28 % during the year as compared to 12.90% for the previous year.

Your Companys Flexible packaging unit set up in the year 2016-17 is now running smoothly. All the units of the Company situated at Silvassa, Haridwar, Guwahati and Goa are performing well and their operations are stable.

Your Company has completed a green field project at Goa during the Financial Year 2018-19 and the unit is now functional. Commercial production has started in the month of March, 2019 in the said unit. Subsequent to setting up the new factory at Plot No. B-51 at Kundaim Industrial Estate, your Company has surrendered the premises of its old rented facility located at sheds No 1,2 and 3 Plot no 124-127A taken on Lease at the same Industrial Estate, Goa to its owners.

Your Company continues to add to its capacity at various units to maintain its growth. Accordingly, it is adding a printing line at Haridwar this year by importing a sheetfed offset press from Koenig & Bauer, Germany as well as other finishing machines. It will also add several balancing machines at its other units.

FUTURE PROSPECTS

As a result of various expansion plans undertaken by the company over the past few years, your company presently has 16 highly configured printing lines installed across its various units. Moreover, your company is adding capacity at its Haridwar unit in the current year. Your Directors are confident of achieving higher rates of growth in the future and an improvement in profitability as a consequence. Your company is now well positioned in the market place on account of a larger and more varied manufacturing base.

DIRECTORS

The term of Independent Directors namely Mr. Atul Sud, Mr. Sudhir Merchant and Mr. Rabindra Jhunjhunwala, in accordance with the provisions of section 149 of the Companies Act, 2013 expired on 31.03.2019. They have been re-appointed for the second term of five years with effect from 01.04.2019 by passing special resolution through Postal Ballot on 27.03.2019.

Mrs. Sonal Agrawal whose first term as Independent Director also expired on 31.03.2019 has not sought re-appointment due to personal reasons. The Board places on record its sincere appreciation and gratitude for the valuable services rendered by her as an Independent Director of your company. The Directors are making efforts to identify and induct a suitable member on its Board as an Independent Woman Director

Mr. Sunil Talati was appointed as Independent Director of your Company, pursuant to the provisions of Section 149 of the Companies Act, 2013 for the period upto 21.01.2020. Based on his performance evaluation, the Nomination & Remuneration Committee recommended his reappointment as Independent Director. The Board of Directors of your Company, in its Meeting held on 30.05.2019, therefore recommended the reappointment of Mr. Sunil Talati as Independent Director for a second term for the period upto 21.01.2025, as provided in the resolution. A brief profile of Mr. Sunil Talati has been given in the annexure to the Notice convening the Annual General Meeting.

In accordance with the provisions of Section 152 of the Act and your Companys Articles of Association, Mr. Rishav Kanoria and Mr. S G Nanavati, retire by rotation at the ensuing Annual General Meeting of your Company and being eligible, offer themselves for re-appointment. The Board recommends their re-appointment for the consideration of the Members of the Company. A brief profile of Mr. Rishav Kanoria and Mr. S G Nanavati have been given in the annexure to the Notice convening the Annual General Meeting.

A Declaration of Independence under section 149(6)/(7) of the Companies Act, 2013 from its Independent Directors Mr. Sudhir Merchant, Mr. Atul Sud, Mr. Rabindra Jhunjhunwala and Mr. Sunil Talati respectively, has been received by your Company.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 134(3)(c) of the Companies Act, 2013 with respect to the Directors Responsibilities Statement, it is hereby confirmed;

(a) In the preparation of the annual financial statement, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any:

(b) The directors 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 and loss of the company for that year;

(c) The directors 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 preventing and detecting fraud and other irregularities;

(d) The directors have prepared the annual accounts on a going concern basis;

(e) The directors 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

(f) The directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

KEY MANAGERIAL PERSONNEL

The following persons are the whole time Key Managerial Personnel in terms of Section 203 of the Companies Act, 2013:

Sr. No. Name of the Person Designation
1. Mr. K. K. Kanoria Executive Chairman
2. Mr. Saket Kanoria Managing Director
3. Mr. Akshay Kanoria Executive Director
4. Mr. S. G. Nanavati Executive Director
5. Mr. Vivek Poddar Chief Financial Officer
6. Mr. Harish Anchan Company Secretary

NUMBER OF BOARD MEETINGS

During the year under review 4 (four) meetings of Board of Directors of the Company were held on 25.05.2018, 03.08.2018, 02.11.2018 and 11.02.2019. The gap between two meetings did not exceed 120 days.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

The company does not have any subsidiary, associates and joint venture Companies

CORPORATE GOVERNANCE

It has always been the Companys endeavor to operate in a fair and transparent manner with the highest standards of Corporate Governance. The Company complies with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

A separate section on Corporate Governance is included in the Annual Report and the Certificate from the Statutory Auditors confirming the compliance of conditions on Corporate Governance as stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is given as annexure to this effect.

AUDIT COMMITTEE

Pursuant to the provisions of Section 177 (8) of the Companies Act, 2013, the composition of the Audit Committee is disclosed as under:

Sr. No. Name Position
1. Mr. Atul Sud Chairman – Independent Director
2. Mr. Sudhir Merchant Member – Independent Director
3. Mrs. Sonal Agrawal * Member – Independent Director
4 Mr. Sunil Talati Member – Independent Director

*upto 31.03.2019.

The Board of Directors of the Company accepted all the recommendations of the Audit Committee during the year. During the year 4 (four) Audit Committee Meetings were held on 25.05.2018, 03.08.2018, 02.11.2018 and 11.02.2019. The gap between two meetings did not exceed 120 days.

NOMINATION AND REMUNERATION COMMITTEE:

Pursuant to the provisions of Section 178 of the Companies Act, 2013 and Rule 6 of the Companies (Meetings of Board & its Powers) Rules, 2014, the composition of the Nomination and Remuneration Committee is disclosed as under:

Sr. No. Name Position
1 Mr. Sudhir Merchant Chairman – Independent Director
2 Mrs. Sonal Agrawal * Member – Independent Director
3 Mr. Atul Sud Member – Independent Director
4 Mr. Sunil Talati Member – Independent Director

During the financial year 2 (two) meetings of the Nomination and Remuneration Committee were held on 25.05.2018 and 11.02.2019.

* upto 31.03.2019.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Corporate Social Responsibility Committee of the Company, consists of the following members :-

Sr. No. Name Position
1 Mr.Sudhir Merchant Chairman – Independent Director
2 Mr.Saket Kanoria Member – Managing Director
3 Mr.Rishav Kanoria Member – Non-Executive Director

A policy on the (CSR) formulated by the CSR Committee is available at the website of the Company www.tcpl.in. The Company has spent adequately the amount required to be spent on CSR activities during the financial year. The required detail of expenditure incurred under CSR Programs in the prescribed format is annexed to the Directors Report. The meeting of CSR Committee was held on 20.05.2018

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the Financial Year 2018-19 the Company has not given any Loans, or provided Guarantees or made Investments as defined under section 186 of the Companies Act, 2013

PARTICULARS OF CONTRACT OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year were on an arms length basis and were in the ordinary course of business. There were no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which might have potential conflict with the interest of the Company at large. The particulars of Contract or arrangement in form AOC-2 as required under Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014 is annexed to this Board Report

A Policy on dealing with Related Party Transactions is available on the website of the Company www.tcpl.in

The disclosure requirements regarding Holding and Subsidiary Companies are not given as there is no Holding / Subsidiary Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a structured questionnaire was prepared after taking into consideration the various aspects of the Boards functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.

The performance evaluation of the Independent Directors were completed. The performance evaluation of the Chairman and the Non- Independent Directors were carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process. The separate meeting of Independent Directors was held on 25.05.2018. The determined criteria for performance evaluation were as follows:

i. Attendance.

ii. Willingness to spend time and effort to know more about the company and its business.

iii. Contribution towards business development, Management of Affairs of Company, Corporate Governance.

iv. Contribution to developments of various Policies such as Remuneration Policy, Boards Diversity Policy, Related Party Transaction Policy & Vigil Mechanism Policy

v. Sharing of knowledge and experience for the benefit of the Company.

vi. Following up matters whenever they have expressed their opinion

vii. Updated with the latest developments in areas such as corporate governance framework and financial reporting and in the industry and market conditions

viii. Achievement of business plans, labour relation, litigation, attrition level of employees, compensation policy, vigil mechanism, establishment and implementation of internal control system etc.

The familiarizing programme for the independent directors of the company, regarding their roles, rights, responsibilities in the Company, nature of the industry in which the company operates, business model of the company, etc. was duly conducted. The details of familiarization programme is disclosed on the website of the Company www.tcpl.in.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report.

POLICY FOR SELECTION, APPOINTMENT AND REMUNERATION OF DIRECTORS INCLUDING CRITERIA FOR THEIR PERFORMANCE EVALUATION

The Company has adopted a "Nomination & Remuneration Policy" which inter-alia includes Companys policy on Board Diversity, selection, appointment and remuneration of directors, criteria for determining qualifications, positive attributes, independence of a director and criteria for performance evaluation of the Directors. The Policy broadly lays down the guiding principles, philosophy and basis for payment of remuneration to Executive and Non-Executive Directors, Key Managerial Personnel, Senior Management and other employees. The Nomination & Remuneration Policy of the Company has been posted on the website of the Company www.tcpl.in.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism Policy for directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the Companys code of conduct or ethics Policy. This mechanism provides adequate safeguards against victimization of directors/employees to deal within stance of fraud and mismanagement, if any.

The Vigil Mechanism Policy inter alia provides a direct access to the complainant to the Chairman of the Audit Committee of the Company.

The Vigil Mechanism Policy of the Company is also posted on the Companys website www.tcpl.in

RISK MANAGEMENT

The Company being a manufacturer of the packaging material is always exposed to the general risks such as government regulations and policies, statutory compliances and economy related risks as well as market related risks. The Company from time to time identifies such risks and has put in its place appropriate measures for mitigating such risks.

SEXUAL HARASSMENT POLICY

The Company has in place Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed of during the year 2018-19:

a) No of complaints received: Nil

b) No of complaints disposed of: N.A.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9, as required under Section 92 of the Act, is annexed which forms an integral part of this Report and is also available on the Companys website www.tcpl.in.

SIGNIFICANT REGULATORY OR COURT ORDERS

During the Financial Year 2018-19, there are no significant and material orders passed by the regulators or Courts or Tribunals which can adversely impact the going concern status of the Company and its operations in future.

RESPONSES TO QUALIFICATIONS, RESERVATIONS, ADVERSE REMARKS AND DISCLAIMERS MADE BY THE STATUTORY AUDITORS AND THE SECRETARIAL AUDITORS

There are no qualifications, reservations, adverse remarks and disclaimers of the Statutory Auditors in their report on Financial Statements for the Financial Year 2018-19.

There are no qualifications, reservations, adverse remarks and disclaimers of the Secretarial Auditors in the Secretarial Audit Report for the Financial Year 2018-19.

PUBLIC DEPOSITS

The Company has not accepted any deposits from the public within the meaning of Section 73 and 76 of the Companies Act, 2013 and Rules made thereunder.

SHARE CAPITAL

As on 31.03.2019 the authorised share capital of the Company is Rs.10.00 crores divided into 1,00,00,000 equity shares of Rs. 10/- each and the paid up equity share capital is Rs.9.10 crores comprising of 91,00,000 equity shares of Rs. 10 each fully paid up.

FINANCE AND ACCOUNTS

As mandated by the Ministry of Corporate Affairs, the financial statements for the year ended on 31.03.2019 has been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (hereinafter referred to as "The Act") read with the Companies (Accounts) Rules, 2014 as amended from time to time. The estimates and judgements relating to the Financial Statements are made on a prudent basis, so as to reflect in a true and fair manner, the form and substance of transactions and reasonably present the Companys state of affairs, profits and cash flows for the year ended 31.03.2019. The Notes to the Financial Statements forms an integral part of this Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report on the operations of the Company, as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "Listing Regulations") is provided in a separate section and forms an integral part of this Report.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

There are 1724 employees on the Companys payroll as on 31.03.2019.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are provided in the Annual Report, which forms part of this Report.

Disclosures relating to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are also provided in the Annual Report, which forms part of this Report.

Having regard to the provisions of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the registered office of the Company during working hours and any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request.

SECRETARIAL AUDITOR

M/s Makarand M Joshi & Co., Practicing Company Secretaries, were appointed to conduct the Secretarial Audit of the Company for the financial year 2018-19, as required under Section 204 of the Companies Act, 2013 and rules made thereunder.

The Secretarial Audit Report for Financial year 2018-19 forms part of Annual Report as Annexure to the Boards Report.

During the year 2018-19, the company has also complied with the Secretarial Standards as amended and applicable to the Company.

CONSERVATION OF ENERGY, TECHNOLOGICAL ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Your Company continues to make efforts for conservation of energy substantially and optimizing the use of energy.

Foreign exchange earnings and outgo

Foreign Exchange Earned Rs. 11986.81 Lakhs
Foreign Exchange Outgo Rs. 7916.32 Lakhs

INTERNAL FINANCIAL CONTROLS WITH RESPECT TO FINANCIAL STATEMENTS

Your Company remains committed to improve the effectiveness of internal financial controls and processes which would help in efficient conduct of its business operations, ensure security to its assets and timely preparation of reliable financial information.

The internal financial controls with reference to the Financial Statements are adequate in the opinion of the Board of Directors.

The Company has a proper system of internal controls to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition and that transactions are authorized, recorded and reported correctly.

The internal control is supplemented by an extensive programme of internal, external audits and periodic review by the Management.

This system is designed to adequately ensure that financial and other records are reliable for preparing financial information and other data and for maintaining accountability of assets.

The Statutory Auditors and the Internal Auditors were, inter alia, invited to attend the Audit Committee Meetings and present their observations on adequacy of internal financial controls and the steps required to bridge gaps, if any. There are no observations of Statutory and Internal Auditors.

STATUTORY AUDITORS

M/s. Singhi & Co., Chartered Accountants have been appointed as Statutory Auditors of the Company in the 29th Annual General Meeting held on 09.08.2017 of the Company, from the conclusion of the said Annual General Meeting, for a period of 5 years, until the conclusion of the 34th Annual General Meeting of the Company.

COST RECORDS AND AUDIT

The provisions relating to maintaining of cost record and conduct Cost Audit are not applicable to the Company.

ACKNOWLEDGMENT

Your Directors take this opportunity to place on record their warm appreciation for the valuable contribution, untiring efforts and spirit of dedication demonstrated by the employees and officers at all levels, in the sure and steady progress of the Company. Your Directors wish to record their appreciation to all our bankers namely Bank of Baroda (formerly Dena Bank), Axis Bank, ICICI Bank, Citi Bank, RBL Bank and DBS Bank for their continued support and timely assistance in providing working capital and long-term fund requirements.

For and on Behalf of the Board of Directors
Place: Mumbai
Date:30.05.2019 Chairman