Thirumalai Chem. Director Discussions

With Management Discussion & Analysis


The Members

Thirumalai Chemicals Limited

Your Directors are pleased to present to you the Fiftieth Annual Report & Audited Statement of Accounts of the Company for the year ended March 31, 2023. The Management Discussion and Analysis has also been incorporated into this report.


(Rs In Lakhs)

Particulars Year Ended 31 Mar 2023 Year Ended 31 Mar 2022
Revenue from Operations 1,84,727 1,43,809
Other Income 4,426 1,473
Total Income 1,89,153 1,45,282
Gross Profit/(Loss) before Interest, Finance Charges and Depreciation (EBITDA) 21,996 25,475
Interest and Finance Charges (3,362) (1,818)
Profit/(Loss) before Depreciation and Tax 18,634 23,657
Depreciation (3,003) (3,198)
Profit/(Loss) before Tax (PBT) 15,631 20,459
Provision for Tax (3,473) (4,929)
Profit/(Loss) after Tax 12,158 15,530
Provision for Deferred Tax (205) (299)
Profit/(Loss)after Tax (PAT) 11,953 15,231

• The Net Revenue including Export Earning (FOB) during the year was 20,706 Lakhs (Previous Year: 15,791 Lakhs).


(Rs In Lakhs)

Particulars Year Ended 31 Mar 2023 Year Ended 31 Mar 2022
Revenue from Operations 2,13,224 1,99,819
Other Income 3,015 1,159
Total Income 2,16,239 2,00,978
Gross Profit/(Loss) before Interest, Finance Charges and Depreciation (EBITDA) 21,634 45,237
Interest and Finance Charges (3,125) (2,037)
Profit/(Loss) before Depreciation and Tax 18,509 43,200
Depreciation (5,568) (5,663)
Profit/(Loss) before Tax (PBT) 12,941 37,537
Provision for Tax (3,790) (9,208)
Profit/(Loss) after Tax 9,151 28,329
Add : Provision for Deferred Tax (168) (206)
Profit/(Loss)after Tax (PAT) 8,983 28,123


Based on the performance of the Company and the anticipated Investments in various Projects that have been announced, your Directors have recommended a dividend of 1.50/- per share for the Financial Year 22-23 (previous year 2.50/-per share was paid). This would result in an out flow of 1,536 Lakhs, if approved by the shareholders at the Annual General Meeting.


The current global economic perspective

The entire chemical industry in India had seen robust economic growth over the last five years including excellent performance during the pandemic. However, the world economic outlook for growth has fallen from 3.4% in 2022 to under 2.0% in 2023. There are already indications that most countries in European economies are entering recessionary conditions. Despite these projections of low growth rates, Indias growth is expected to be resilient. After seeing a surge in market conditions and manufacturing output, there have been signs of moderation in the second half of FY23

India remains one of the few economies which is expected to ride out the over-all financial and economic stress with expectations of more than 6% growth rate. The Indian governments initiatives, with respect to investment in infrastructure and push towards increased private consumption are seen as factors that will drive improved GDP. Indias share in the global chemical sector is expected to grow significantly in the next decade. The cost competitive scenario due to low capital and operating expenses coupled with focus on profitability have contributed to the chemical industry generating high performance results. In spite of obstacles like availability of raw materials and dearth in R&D talent, India remains the most attractive investment geography for global majors.

Business Performance

The first half of FY 22-23 saw a strong demand and healthy margins leading to excellent results. This has contracted in the second half of the year. Rising feedstock prices for our primary product Phthalic Anhydride resulted in reduced margins. Though the companys H-2 performance has been impacted by the slowdown, demand continues to be strong. Initiatives taken to improve reliability and reduce cost have ensured that we were able to weather the downturns.

Various challenges faced in plant operations in both Ranipet and Dahej resulted in some cost increases. However,we were able to address major reliability

problems and long pending plant refurbishment and process improvements which will result in better efficiencies, productivity and capacity utilisation in the medium and long term.

The summary of the quarterly performance is given below.

Sl. No. Quarter Total Income in Lakhs EBITDA in Lakhs PBT in Lakhs
1 Q1 FY22-23 48,694 6,432 5,210
2 Q2 FY22-23 50,088 6,158 4,819
3 Q3 FY22-23 46,109 4,197 2,368
4 Q4 FY22-23 44,262 5,209 3,234

The third quarter saw a decline due to reduction in demand from the user segments. The demand from the organic pigments industry reduced due to fall in capacity utilisation. However, Q4 FY23 saw a general improvement in the market of all our products. Through all of these challenges we have managed to evacuate the entire volume produced during this period. Logistics costs that had seen increases in the past 2 years have started coming down and, in some areas, have gone back close to pre-pandemic levels.

Overall Business and the Individual Units/ Products

On the whole, considering the economic slowdown, your company has managed to bounce back from the slide in Q3 FY23 and stabilize operations. Travel channels having reopened post pandemic, our marketing and operations staff have been able to connect in person and establish stronger relationships with customers and suppliers.

Phthalic Anhydride (PAN)

Our main commodity business, Phthalic Anhydride (PAN) has faced some hindrances by way of regulatory actions on the downstream products in China and United States, resulting in performance decline in Q3. Towards the second half of Q4, the market recovered. We expect demand recovery and margin improvement to take place in the near future.

On the market side, there are capacity expansions and a customer who has started his own PAn production. These additional capacities including that from our subsidiary in Dahej are expected to come on stream in FY 23-24. These capacity additions are expected to satisfy the increased Indian demand. India has been importing more than one third of its consumption of Phthalic anhydride. Along with replacing most of these import volumes, the 6 - 8% annual growth in the market for PAn will ensure that these capacities will be fully consumed in the next 2 years.

Your company has always been strong leader in its sustainable manufacturing, in key parameters like greenhouse gas emission, water consumption, zero discharge, recovery of valuable products from waste streams and reduction of inputs. The company has continued its initiatives in waste reduction and water use. The investments in this area in the past couple of years has resulted in improved efficiencies in water recycling. These programs continue with a strong focus on improvement. We have also initiated collection of packaging from customers for reuse and also, reusing the packaging supplied to internal customers. More information about our sustainable manufacturing initiatives is given in our sustainability report.

Fine Chemicals and Food Ingredients

The Food Ingredients Business of your company posted sterling performance in 2022-23 with the highest ever volume, revenues and profitability.

After a sluggish 2020-21 in the food ingredients market due to the global impact of the pandemic, the demand saw a quick recovery with most end of our consumers in India and overseas returning to full production.

Your company implemented several improvements in the food ingredients plants and operating rates are at full capacities. These initiatives also resulted in steady operations, higher volumes which helped us improve penetration of the US and European markets. We now serve hundreds of customers in these geographies.

The Ukraine war increased the cost of energy for manufacturers in Europe and North America and resulted in high prices in these markets. Your company was able to take advantage of these factors. Positioning of sales personnel in these markets offering real time services to customers, new customer acquisitions, real time feedback on the market demand and prices helped the business substantially. The team was able to close many annual contracts in the beginning of the year to new customers.

Consequently, the absolute margins increased substantially for this business resulting in better profitability.

Human Resources and Strengthening the Organization

The company has been able to bring in many improvements in HR and People policies. Adoption of best practices from industry is being actively pursued by Mr. Sanjay Sinha, CEO and Mr. S. Raghavan, President Manufacturing. Consequently, improvements in safety, productivity, capacity utilisation, induction of new systems and processes are gathering pace. The many younger professionals who were hired in the last 3-5 years have contributed significantly to improvement in operations and project execution. The companys policy to induct and train new professionals has resulted in a basket of very good talent, who would also be to handle responsibility in the future.

Our long-term policy of hiring and intensely training new recruits from reputed colleges means that the average age of the organisation is under 35 years.

However, like many other industries, your company has also seen a higher rate of employee turnover this year.

The new performance management system introduced in the company has resulted in removing subjectivity in evaluations and also brought on the requirement of training need identification by middle and senior managers. The subsidiary in Dahej has inducted senior management including the managing director, construction manager, project managers and support teams. The multiple locations of operations within the group in south India, western India, Malaysia and now in the US provide good growth opportunities and roles to aspiring young, middle and senior management.

New investments &Projects

Dahej Project

The project in Dahej through our subsidiary TCL Intermediates Private Limited for manufacture of Phthalic Anhydride and fine chemicals and derivatives is well on its way. All needed regulatory approvals are in place. Construction is well under way. All the major equipments and materials have been ordered and many have already arrived on site. The commissioning of this plant is expected late this year. The team is working very hard to drive this project fast in spite of delays because most equipment suppliers and contractors are overloaded by the India growth story.

US Project and US Subsidiary Activities

Work on the project in the US is at the initial phases of civil construction. Many of the equipment packages have been shipped out by global vendors and have already arrived at the site. More are expected to be delivered soon.

70 % of the plant is being constructed modularly in India; this is well underway at TCL Technology and Engineering (SEZ) Division in India and is progress is good. The equipment, piping, instruments, electricals and other components of the modular units are being assembled at the site in specifically designed structurals. These will be tested and shipped out in modules directly to the US site by of Q3 & Q4 of FY 2023-24.

Logistics and transporting methodologies are being optimized for cost and construction time lines. Detailed discussions are ongoing with contractors to ensure that the construction and commissioning in the US goes smoothly. TCLS LLC expects to commission the plant by end CY 2024.

Our Subsidiary in the Netherlands TCL Global BV

The European subsidiary TCL Global BV completed its second year of operations. After Covid restrictions were removed, we were able to position a resident manager for the subsidiary in The Netherlands. Who has extensive experience in the marketing and sales of food ingredients and fine chemicals for the European market.

The unit was able to increase sales to direct accounts and generate substantial new business for the groups products. Revenues increased by over 30% resulting in higher absolute operating margins for the subsidiary.

Our Subsidiary in Malaysia

After an excellent performance in FY 22, Optimistic Organic Sdn Bhd. Continued with adecent performance in H1 of FY 2023. However,business was severely impacted in H-2 due to a sharp drop in Maleic Anhydride demand and prices in the Far East and Asia. They took this opportunity to schedule extended plant shutdowns required for mandatory inspection as required by regulations once in three years. The re-catalyzation in one train was also undertaken. Due to these scheduled shutdowns, production in FY 2023 was lower.

The Company continued to implement several improvement programmes to improve efficiencies and reliability. It continued its efforts to widen its geographical spread of the customers to minimise regional variations and risks arising from volatility in the markets. In spite of overall pressure of Maleic Anhydride demand during this year, the company has sold all its production. The company has also undertaken several initiatives during the year to strengthen its SHE performance. The company is also evaluating increasing its downstream portfolio to improve performance.



(USD in Mn)

S. No Particulars Year Ended 31-Mar-23 Year Ended 31-Mar-22
1 Revenue from Operations 50.68 81.29
2 Other Income 0.86 0.05
3 Total Revenue 51.54 81.34
4 Gross Profit / (Loss) before Interest, Finance Charges and Depreciation (EBITDA) 3.03 27.34
5 Interest and Finance Charges -0.2 -0.17
6 Profit/(Loss) before Depreciation and Tax 2.83 27.17
7 Depreciation -3.06 -3.38
8 Profit/(Loss) before Tax (PBT) -0.23 23.79
9 Provision for Tax -0.16 -5.76
10 Profit/(Loss) after Tax -0.4 18.03
11 Provision for Deferred Tax - -
12 Profit/(Loss) after Tax (PAT) -0.4 18.03

Finance and Accounts

Following through on the strong financial position that your company has established and cash reserves over the last few years, this year saw the deployment of cash to the new subsidiaries for investment in the projects. This is after a major project - plant replacement carried out in 2018-19 with internal accruals. The cash reserves that were built also helped your company smoothly handle increased raw material costs, reduced margins and working capital increase in Q3. Your company continued to utilize its internal accruals for all fund based working capital requirements.

A lot of the accounting processes have been strengthened in line with the complexities of the group and investments and operations in multiple locations. Additional financial controls and risk mitigation measures have been brought in based on advice by risk consultants and the risk management committee.

The huge inflationary increase in the United States and consequent increase in FED rates impacted interest rates in India too. Your company has seen the result of these increased financial costs during the year. The company continues to work with various financial institutions to look for opportunities in reducing cost of financing for the project. The general opinion is that the US FED rates will remain the same or increase marginally over the next 12-month period, with a consequent firm US dollar. Your company has a robust and conservative foreign currency policy to manage these fluctuations and uncertainties.

Looking forward to FY 2023-24

The post COVID period between FY 21- FY23, saw a tremendous growth in volumes and margins of all products. The chemical industry in India had performed extremely well on the back of increased spending by consumers. This boom has started evening out and in Q3 & Q4, the industry saw reduction in industrial output and growth. The demand for all our products continues to remain strong in India, however, margins were rationalized due to increased feed stock prices, without a corresponding increase in the prices of end product. This situation is expected to continue in the near term.

The demand in our user segments for our main product Phthalic anhydride continues to remain strong. The implementation of large growth plans by our customers, especially in the paint,polymer and construction industries started in early 2023, ensures that the growth for our products will be significant. The ongoing investment in infrastructure by the Indian government gives rise to many opportunities for Petro-Chemicals and Fine Chemicals.

The recession in Europe does affect the companys export margins in this region. The economic situation in Europe is expected to remain weak for the foreseeable future. While continuing supply to long term and contract customers in

Europe, your company started on a program to look at North American and other markets about 3 years ago for these food ingredients and fine chemicals, especially in preparation for the US investment.

The entire senior management team has been monitoring the global economic situation and is making sure that the company is nimble and able to shift strategies very quickly. The strong performance of the company in spite of reduced margins is a testament to the ability of the teams to be flexible and their preparedness to handle fast fluctuating market and this was proven during the pandemic and the ongoing Ukraine war. Our new investments will help us meet growing Indian demand and the very healthy international markets for food ingredients and fine chemicals.

New business

During the year FY23, we have set up a separate team under our Group CEO Mr. CG. Sethuram, to look at new initiatives, products and businesses for the medium term and develop of pipe line that will help us go further in the longer term. Indias attractiveness and the global situation is changing fast. Our manufacturing position in India and in the ASEAN along with the new investment in the resource rich and high volume North American market, presents us with significant opportunities in product range in addressable market segments. This will also focus on growth in specialties and fine chemicals in these regions. We hope to see the initial results of this initiative in the next couple of years.


In addition to our regular development and training programs, we implemented a wide range of initiatives to upskill our employees. We conducted technology/ equipment related training program for our operations teams so that they are familiar with the latest developments in industry practices. The best practices in each company within the group are also shared through visits and training.

Ongoing skill enhancement initiatives are conducted for employees who work in the project teams. The company is very proud to say that the project teams have performed extremely well under a high pressure environment in all areas of project execution.

Each and every employee has played an important role in the companys success. Our employees are the cornerstone upon which our organization is built. Without their dedication, commitment and active support our achievements would not have been possible. In this period of growth of your company, it will be these employees and many more, who will make it possible to be a successful organization with excellent values and culture.

Public Initiatives

Your company believes that social responsibility is an integral part of doing business. In line with this thought we continue to be actively involved in social initiatives in the fields of health care, education and community development.

Apart from the general health initiatives, the company contributed towards setting up specialized dialysis centers for Hepatitis B patients. The company continues to be involved with orgnisations providing education for Tribal and underprivileged children and economic development of the community. The orgnisations funded by the company continuously look to increase their reach in the community for education and healthcare initiatives.

Your company plays an active role in industry associations like the Indian Chemical Council, Confederation of Indian Industry, CPMA and CIA. Through these associations the company also participates in Industry initiatives and government interactions to represent various issues of the industry to relevant authorities. Improvement in trade policy, international trade negotiations and tariff concession for the industry are some of the key areas of engagement during the year.

One of the new initiatives that your company is involved in along with other chemical companies in the region is the training and skill development of chemical engineers fresh out of college. The course acts as bridge between undergraduate education and industry needs.

Overall, your company remains dedicated to fostering positive change through various initiatives, partnerships, and contributions aimed at improving public welfare, healthcare, education and industry development.


None of this would be possible without the interest and participation of our stakeholders - Customers, Bankers, Suppliers, Distributors, Consultants, and Government agencies, and the local Communities.

We hope to have the continued involvement of all shareholders in the affairs of the company and to share in the achievements of the company in the years to come.


The Board of your Company consists of

• The Chairman & Managing Director - Mr. R. Parthasarathy

• Managing Director & Chief Financial Officer - Mrs. Ramya Bharathram

• Seven Independent Non-Executive Directors:

? Mr. R. Ravi Shankar

? Mr. Raj Kataria

? Mr. Dhruv Moondhra

? Mr. Arun Ramanathan

? Mr. Rajeev M Pandia

? Mrs. Bhama Krishnamurthy

? Mr. Arun Alagappan

• Two Non-Executive Director:

? Mr. R. Sampath - Chairman - Ultramarine and Pigments Ltd.

? Mr. P. Mohana Chandran Nair

(Ceased to be a Whole-time Director from 3rd October 2022)

• They are supported closely by

? Mr. C.G. Sethuram - Group Chief Executive


? Mr. Sanjay Sinha - Chief Executive Officer

? Mr. T. Rajagopalan - Company Secretary

• And the Business and Functional Heads

? Mr. S. Venkatraghavan - President - Food Ingredients

? Mr. R. Srinivasaraghavan - President - Factory Operations

? Ms. J. Radha - Executive Vice President, Finance

? Mr. B. Krishnamurthy - Executive Vice President, Accounts &Systems

During the year under review,Mr. P. Mohana Chandra Nair (DIN: 07326079) ceased to be a Whole-time Director from 3rd October 2022 on attaining his age of 70 years in accordance with the provisions of Sec 196(3)(a) of the Companies Act, 2013. He will be a Non-Executive and Non-Independent Director of the Company from 3rd October 2022.

Your Directors play a very active role in the Company. They bring in expertise in Business Strategy and Management, Technology, Finance & Accounting, Governance, Project Appraisal & Management, Government Relations.

Their interaction with the Management team is frequent and intense, at the Board and Committees, through reviews, suggestions, criticisms & advice to the Management team over the last 8 years.

The executive management team in turn has been very transparent in presenting and discussing initiatives & plans and failures, issues & responses.

This healthy and open interaction has been of immense value to the governance, health and growth of the company.

The Committees in the Board, especially the Risk Management Committee, Business Review Committee and the Audit Committee met often and participated in depth by setting goals, reviewing performance, correcting slippages and monitoring execution.

The Nomination & Remuneration Committee, Stakeholders Relationship Committee and the Corporate Social Responsibility Committee have been active in their respective roles.

Further details of these are given in the Corporate Governance Report.


Your Company continues to play an active and important role in the welfare of the local communities.

The Founders of your Company, Mr. N.S. Iyengar and Mr. N.R. Swamy had set up the Thirumalai Charity Trust (TCT) in 1970, and The Akshaya Vidya Trust (AVT) in 1994.

Thirumalai Chemicals supports TCT financially and through management reviews and in their infrastructure planning & development process.

The TCT works in Ranipet District where our main Indian manufacturing site is located, since 1983, providing services in Community Healthcare, Womens Empowerment, Disability, De-addiction, and Village development.

The TCT founded and operates the Thirumalai Mission Hospital, which provides primary healthcare in 315 villages, covering over 160,000 people. The Hospital provides both out-patient and in-patient services through departments of General Medicine, Emergency services, Intensive Medical Care, General Surgery, Paediatrics, Obstetrics, Gynaecology, Orthopaedics, ENT, Dentistry, Physiotherapy, De-addiction & Rehabilitation.

With TCLs support, the Thirumalai Mission Hospital has set up a separate centre for Non-Communicable Diseases such as Diabetes, Thyroid disorders, Endocrinology, Obesity, Osteoporosis, etc. The dialysis service started at TMH last year is expanding to serve more people.

This addresses a critical need of the community.

The Vedavalli Vidyalaya Schools (with 3 schools at 2 campuses), managed by The Akshaya Vidya Trust, have around 2,000 students, out of whom 70% are from rural families.

Industrial Relations:

Industrial Relations during the year under review continued to be very cordial.


All taxes and statutory dues have been paid on time. Payment of interest and instalments to the Financial Institutions and Banks are being made as per schedule. Your Company has not collected any Fixed Deposits during the Financial Year.

Contribution to the Exchequer:

The amounts paid to the Central and State Exchequer by way of GST, Customs duties (incl. paid to supplier),

Income Tax and other taxes, is about 37,624 Lakhs on Gross Sales of about 1,73,704 Lakhs (Previous Year 31,316 Lakhs on Gross Sales of about 1,42,368 Lakhs).

Contribution to the Exchequer is about 20% of your Companys Sales.


Calculated on FOB basis, Exports amounted to 20,706 Lakhs (previous year 15791 Lakhs)

Particulars of loans, guarantees or investments

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

Related Party Transactions

All transactions entered into with Related Parties (as defined under the Companies Act, 2013) during the Financial Year were in the ordinary course of business and on an Arms length pricing basis, and do not attract the provisions of Section 188 of the Companies Act, 2013 and were within the ambit of Reg. 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. There were no materially significant transactions with related parties during the Financial Year which were in conflict with the interests of the Company. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes to the Financial Statements.

The Board has approved of a policy for Related Party Transactions which has been uploaded on the Companys website.

Directors Responsibility Statement:

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

i) In preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures.

ii) We have selected such Accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give 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) We have taken proper and sufficient care to maintain 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.

iv) We have prepared the Annual Accounts on a going concern basis.

v) Proper Internal Financial Controls were in place and that the Financial controls were adequate and were operating effectively.

vI) Systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

Business Risk Management

Business Risk Evaluation and Management is an ongoing process within the Organization. The Company has a robust risk management framework to identify, monitor and minimize risks. The composition of the Committee is given below:

Sr. No. Name of member Category
1. Mr. Rajeev M. Pandia Independent Director & Chairman
2. Mr. Dhruv Moondhra Independent Director
3. Mrs. Ramya Bharathram Managing Director
4. Mr. Sanjay Sinha Chief Executive Officer
5. Mr. B. Krishnamurthy Executive Vice President Accounts &Systems

Vigil Mechanism / Whistle Blower Mechanism

The Company has a vigil mechanism to deal with instances of fraud and mismanagement, if any. The details of the Policy are explained in the Corporate Governance Report and also posted on the website of the Company.

Corporate Social Responsibility (CSR) Committee

The Committee recommended continuing support for the Thirumalai Charity Trusts Health and Rural Development Projects and for the Akshaya Vidya Trusts Educational Programmes.

The composition of the Corporate Social Responsibility Committee is given below:

Sr. No. Name of member Category
1. Mr. Arun Ramanathan Independent Director & Chairman
2. Mrs. Bhama Krishnamurthy Independent Director
3. Mr. R. Sampath Director (Promoter)

A detailed note is given in the Corporate Governance report.

Total Expenditure on Corporate Social Responsibility (CSR) as percentage of profit after tax (%):

The Companys total spending on CSR is 2% of the average profit after taxes in the previous three Financial Years towards Health and Sanitation Programmes.

The CSR report is set out in the Annexure A to the Directors report.

Statement pursuant to Listing Agreement:

Your Companys shares are listed with the National Stock Exchange of India Ltd. and the BSE Ltd. We have paid the annual listing fees and there are no arrears.

Business Responsibility and Sustainability Report:

Regulation 34(2) of the SEBI Listing Regulations, 2015, as amended, interalia, provides that the Annual Report of the top 1000 listed entities based on market capitalization (calculated as on 31st March of every Financial Year), shall include a Business Responsibility and Sustainability Report(BRSR Report).

Your Company is in the top 1000 listed entities as on 31st March, 2023. The Company, has presented its BRSR Report for the Financial Year 2022-23, which is part of this Annual Report.

Report on Corporate Governance

The Report on Corporate governance is annexed herewith.

Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013 and under obligations of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board carries out the annual performance evaluation of its own performance, of the Directors individually as well as the evaluation of working of its various Committees. A structured questionnaire is prepared after taking into consideration the inputs received from the Directors, covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its Committees, Board culture, Execution and Performance of specific duties, obligations and governance.

A separate exercise is carried out to evaluate the performance of individual Directors including the Chairman of the Board, who are evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interests of the Company and of its minority shareholders, etc.

The performance evaluation of the Independent Directors is carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors is carried out by the Independent Directors who also review the performance of the Secretarial Department.

The Directors expressed their satisfaction with the evaluation process.

Appraisal of Boards performance

It includes setting individual and collective roles and responsibilities of its Directors, creating awareness among Directors about their expected level of performance and thereby improving the effectiveness of the Board.

Board evaluation contributes significantly to improved performance and aims at,

• Improving the performance of Board in line with the corporate goals and objectives.

• Assessing the balance of skills, knowledge and experience on the Board.

• Identifying the areas of concern and issues to be focused on for improvement.

• Identifying and creating awareness about the role of Directors individually and collectively as Board.

• Fostering Team work among the members of the Board.

• Effective Coordination between the Board and Management.

• Overall growth of the organization

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

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 & Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up by the Company to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

Since the number of complaints filed during the year was Nil, the Committee prepared a Nil complaints report.

Statutory Auditors

M/s. Walker Chandiok & Co LLP, Chartered Accountants (Firm Registration No. 001076N / N500013) were appointed as the Statutory Auditors of the Company for a period of five years at the Annual General Meeting (AGM) of the Company held on July 21,2021, to hold office from the conclusion of the Forty Eighth AGM till the conclusion of the Fifty Third AGM to be held in the year 2026.

Internal Auditors

The Internal Auditors M/s. M.S. Krishnaswamy & Co, Chartered Accountants, have played an important role in strengthening the internal controls within the Company. The Internal Auditors M/s CNK & Associates LLP also contributed significantly.

Cost Auditors

M/s GSVK & Co., Cost Accountants, were appointed as Cost Auditor to conduct cost audit of the cost records maintained by our Company in respect of products manufactured during the Financial Year 2022-23. The Cost Audit Report was filed with the MCA, Government of India, by the Company on August 10, 2022, well before the due date of filing for the Financial Year 2021-22.

Secretarial Audit

The Board appointed M/s. R.M. Mimani& Associates LLP, Company Secretaries, to conduct Secretarial Audit for the Financial Year 2022-23. The Secretarial Audit Report for the Financial Year ended March 31, 2023 is attached to this Report. The Secretarial Audit Report does not contain any qualifications, or reservations or adverse remarks.

Web link of Annual Return

Pursuant to the provisions of section 92(3) and Section 134 (3) (a) of the Companies Act, 2013 a copy of the Annual Return of the Company for the year ended March 31, 2023 will be placed on the website of the company at


In terms of the provisions of section 197(12) of the of the Companies Act, 2013 read with the Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the names and other particulars of employees are set out in the Annexure B to the Directors report.


a) The ratio of the remuneration of each Director to the median employees remuneration for the Financial Year and such other details as prescribed is as given below:

Name of Director Ratio

1. Mr. R. Parthasarathy (Managing Director) 121: 1

2. Mrs. Ramya Bharathram (Managing Director and CFO*) 72: 1

3. Mr. P. Mohana Chandran Nair (Whole time Director#) 5: 1

#Ceased to be a Whole-time Director from 3rd October 2022

For this purpose, sitting fees paid to the Directors have not been considered as remuneration.

b) The percentage increase in remuneration of Managing Director, Chief Financial Officer, Company Secretary or Manager, if any, in the financial year:

Mr. R. Parthasarathy - (Managing Director):0%

Mr. T. Rajagopalan - (Company Secretary): 16% *Mrs. Ramya Bharathram-Managing Director, was appointed as the Chief Financial Officer of the Company on July 24, 2018. No additional remuneration was paid to her for functioning as the CFO.

c) The percentage increase in the median remuneration of employees in the Financial Year: 12%

d) The number of permanent employees on the rolls of the Company: 526

e) The explanation on the relationship between average increase in remuneration and Company performance:

The Companys PAT has decreased from 15,231 Lakhs to 11,953 Lakhs, a decrease of 22% against which the average increase in remuneration is 7%;

f) Comparison of the remuneration of the Key Managerial Personnel against the performance of the Company:

Name Designation Remuneration Rs in Lakhs* % Increase in Remuneration PAT Rs in Lakhs* % decrease in PAT
Mr. R. Parthasarathy Managing Director 528 NIL
Mrs. Ramya Bharathram Managing Director and CFO 316 NIL 11,953 22%
Mr. T.Rajagopalan Company Secretary 46 16

* It consists of Salary/Allowances & Benefits.

The remuneration of the Chairman and Managing Director, Mr. R. Parthasarathy includes the commission of 250 Lakhs, which works out to approximately 2.09% to the net profit for the Financial Year ended March 31,2023.

As per the Compensation Policy, the compensation of the key managerial personnel is based on various parameters including Internal Benchmarks, External Benchmarks, and the Financial Performance of the Company.

g) Variations in the market capitalization of the Company, price earnings ratio as at the closing date of the current Financial Year and the previous Financial Year and percentage increase or decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer:

Date Issued Capital (No. of Shares) Closing Market Price per share EPS in PE Ratio Market Capitalization (Rs In Lakhs)
31.03.2022 102,388,120 266.00 14.88 17.88 2,72,352
31.03.2023 102,388,120 171.85 11.67 14.72 1,75,954
Increase /(Decrease) NA (94.15) (3) (3) (96,398)
% of Increase/(Decrease) NA (35.39%) (22) (18) (35)
Issue Price of the share at the last Public Offer (IPO) 1
Increase in market price as on 31.03.2023 as compared to Issue Price of IPO 170.85
Increase in % 17,085%

h) Average percentile increase already made in the salaries of Employees other than the Managerial Personnel in the last Financial Year and its comparison with the percentile increase in the Managerial remuneration and justification thereof and any exceptional circumstances for increase in the managerial remuneration:

Average increase in remuneration is 15% for Employees other than Managerial Personnel & 28% for Managerial Personnel (KMP and Senior Management)

i) The key parameters for any variable component of remuneration availed by the Directors:

Except Mr. R. Parthasarathy (Managing Director), Mrs. Ramya Bharathram (Managing Director), and Mr. P. Mohana Chandran Nair, (Whole-time Director up to 3rd October, 2022), no Directors have been paid any remuneration, as only sitting fees have been paid to them. The said Directors have not been paid any variable remuneration. The Directors are eligible for a commission on Net Profits as per the provision of sec.197 of the Companies Act, 2013.

j) The ratio of the remuneration of the highest paid Director to that of the employees who are not Directors but receive remuneration in excess of the highest paid director during the year: Not Applicable

k) If remuneration is as per the remuneration policy of the Company: Yes

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The particulars required to be included in terms of Section

134(3)(m) of The Companies Act, 2013 read with Rule 8(3)

of The Companies (Accounts) Rules, 2014 with regard to conservation of energy, technology absorption, foreign exchange earnings and outgo are given in Annexure C.

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor.

The details form part of Note No. 36 of Notes to standalone financial statements.

Cautionary Statement

Companys objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws,

economic developments within the country and other factors such as litigation, plant breakdowns, industrial relations, etc.


The Directors would like to place on record our sincere appreciation for the continued support given by the Banks, Internal Auditors, Government Authorities, Customers, Vendors, Shareholders and Depositors during the period under review.

The Directors also appreciate and value the contributions made by the employees of our Company at all levels.

For and on behalf of the Board of Directors

R. Parthasarathy R. Ravi Shankar
Managing Director Director
(DIN:00092172) (DIN:01224361)
Place: Chennai Place: Chennai
Date: 17th May, 2023 Date: 17th May, 2023