Trident Ltd Directors Report.

Dear Members,

Your Directors are pleased to present the 31st Annual Report and Audited Financial Statements of the Company for the Financial Year ended on March 31, 2021.

RESULTS OF OPERATIONS CORPORATE OVERVIEW

The Company operates in diversified business segments viz. Home Textiles, Yarn, Paper and Chemicals. The Company also has a captive power plant to cater the needs of its various business segments.

FINANCIAL RESULTS

The financial performance of your Company, on standalone basis, for the year ended on March 31, 2021 is summarised below:

million
Particulars Current Year Previous Year Growth (%)
Total Income 45,353.1 47,239.5 -4.0%
Total Expenses 41,167.7 43,027.4 -4.3%
EBITDA 8,270.0 8,653.1 -4.4%
EBITDA Margin 18.23% 18.30% -7 bps
Depreciation 3,364.6 3,333.0 0.8%
EBIT 4905.4 5,320.1 -8%
Interest (Finance Cost) 720.0 1,108.0 -35.0%
Profit before exceptional item and tax 4,185.4 4,212.1 -0.6%
Exceptional (Income)/Expense (266.1) - -
Profit before tax 4,451.5 4,212.1 5.70%
Tax Expenses 994.1 794.1 25.2%
Profit after tax 3,457.4 3,418.0 1.2%
Other Equity 28,069.5 24,573.0 14.2%
EPS in Rs (Diluted) face value of Rs 1/- each 0.68 0.67 1.5%
Dividend 36% 36% -

FINANCIAL PERFORMANCE AND REVIEW

The total income of the Company during the year under review has been Rs 45,353.1 million as against Rs 47,239.5 million in the previous financial year. The Operating Profit (EBITDA) for the year stood at Rs 8,270.0 million as compared to Rs 8,653.1 million in the previous financial year, a decrease of 4.4 percent. The Company has earned a net profit of 3,457.4 million as against Rs 3,418.0 million in the previous financial year, registering an Increase of 1.2 percent. The Companys earnings per share were Rs 0.68 during the current year.

On April 05, 2021, a major fire broke out in the Cotton warehouse located in the manufacturing facilities at Budhni, Madhya Pradesh, however the fire has not caused any disturbance in the day to day operations of the said facilities. The fire has resulted in major damage of stocks of cotton lying in the cotton warehouse and its building. The loss of inventory and repair cost of damages to building is adequately covered by Insurance. There has been no loss of life due to fire.

A detailed discussion on financial and operational performance of the Company is given under "Management Discussion and Analysis Report" forming part of this Annual Report.

TRANSFER TO RESERVES

During the year under review, the Company has not transferred any amount to the ‘General Reserve and entire amount of profit for the year forms part of the ‘Retained Earnings.

CHANGES IN SHARE CAPITAL

During the period under review, there is no change in share capital of the Company.

DETAILS OF DEBENTURES ISSUED BY THE COMPANY

During the financial year 2020 - 2021, the Company has issued 1,250 Senior, Secured, Rated, Listed, Redeemable, Non-Convertible Debentures (NCDs) of the face value of 10,00,000/- each aggregating to Rs 1,250 million, at par on Private Placement basis at the rate of 6.83% per annum, payable semi-annually from the deemed date of allotment. These NCDs are listed on Wholesale Debt Market Segment of BSE Ltd and shall be redeemed at par in four equal installments at the end of 15th, 27th, 36th and 48th months from the deemed date of allotment. These NCDs shall have asset cover of more than 1.25 times of outstanding amount of NCDs, all the times.

India Ratings and Research (Ind-Ra) has assigned a rating of ‘IND AA- with a Positive Outlook to the said NCDs of the Company, which has been upgraded to IND AA/Stable. These NCDs shall be secured by way of first ranking pari-passu charge by way of mortgage (to be shared between the Debentures Trustee and Existing Lenders) on the immovable properties, first ranking pari-passu charge by way of hypothecation (to be shared between the Debentures Trustee and Existing Lenders) on the movable fixed assets, second ranking pari-passu charge by way of hypothecation (to be shared between the Debentures Trustee and the Existing Lenders) on the current Assets (excluding the Movable Fixed Assets) of the Company. The Company has paid the Interest on these Debentures on May 3, 2021 and the intimation regarding the same is also available on the website of Stock Exchanges.

The Company is in compliance with the requirements of SEBI circular dated November 26, 2018 applicable to Large Corporate Borrowers.

DETAILS OF COMMERCIAL PAPER

During the period under review, following Commercial Papers have been issued and redeemed by the Company :

ISIN Scrip Code Issue Date Maturity date (in Millions)
INE064C14058 718949 June 18, 2020 August 27, 2020 500/-
INE064C14066 719504 September 29, 2020 November 27, 2020 250/-
INE064C14074 719817 December 2, 2020 February 2, 2021 500/-

As on March 31, 2021, no commercial Paper was outstanding, however, the Company has further issued Commercial Papers on April 28, 2021, as per the following details:

ISIN Scrip Code Issue Date Maturity date (in Millions)
INE064C14082 720622 April 28, 2021 June 28, 2021 500/-

DIVIDEND

Your Company has a dividend policy that balances the dual objectives of rewarding shareholders through dividends whilst also ensuring availability of sufficient funds for growth of the Company.

The dividend distribution policy of the Company is annexed herewith as Annexure V.

Consistent with this policy, the following is the summary of dividend paid/ declared by the Company:

Dividend type

Current year

Previous Year

Dividend % Dividend per share Dividend (%) Dividend per share
1st Interim - - 9% 0.09
2nd Interim - - 9% 0.09
3rd Interim - - 18% 0.18
Final 36% 0.36 - -
Total 36% 0.36 36% 0.36

In view of changes made under the Income-Tax Act, 1961 as amended by Finance Act, 2020, dividends paid on distributed profits by the Company shall be taxable in the hands of the shareholders. The Company shall accordingly, make the payment of the final dividend after deduction of tax at source.

CONTRIBUTION TO THE EXCHEQUER

The Company contributed a sum of Rs 2,652.41 million to the exchequer by way of Goods and Service Tax in addition to other direct taxes during the year under review.

EXPORTS

The exports of the Company accounted to 67 percent of revenue from operations. During the year under review, export sales marginally increased to Rs 30,593.9 million as against Rs 26,312 million in the previous year.

CREDIT RATING

The details on Credit Rating are set out in Corporate Governance Report, which forms part of this report.

EXPANSIONS/MODERNISATION

During the year under review, the Company has approved Capital Expenditure in Chemicals Segment for setting up a Detergent Manufacturing unit in Budni, Madhya Pradesh with a capacity of 10 Metric Ton per day. The unit shall manufacture fine quality powdered Detergent of A grade Quality. The above project has been proposed to be implemented at an estimated capital outlay of Rs 33 Lakhs.

The required capital investment, under this project, will be met through an internal accrual and the proposed project shall help to expand the chemical business of the Company and shall further increase the market presence in the chemical segment. The commercial production is expected to commence in the FY 2021-22.

CONSOLIDATED FINANCIAL STATEMENTS

The Audited Consolidated Financial Statements prepared by the Company, in accordance with the Indian Accounting Standards [Ind AS], are duly provided in the Annual Report of the Company.

SUBSIDIARY AND ASSOCIATE COMPANIES

As on the last day of financial year under review, the Company had two subsidiaries - Trident Global Corp Limited, the Indian wholly owned subsidiary and Trident Europe Limited, the overseas wholly owned subsidiary.

Trident Global Corp Limited majorly serves as the Retail Arm of the Company. It is the face of the Company in the domestic markets. Further, Trident Europe Limited provides the proximity to the European Markets & enhances the Brand Presence of the Company.

The audited accounts of the Subsidiary Companies are available on the official website of the Company at https:// www.tridentindia.com/financial-reports

The annual accounts of the Company and of the Subsidiary Companies are open for inspection by any investor at the Registered Office of the Company. The Company will also make available copies of these documents to investors upon receipt of request from them. The investors, if they desire, may write to the Company to obtain a copy of the financial statements of the Subsidiary Companies.

Further, Trident Global Inc. is the foreign Associate Company of Trident Limited. The statement containing highlights of performance of each Subsidiary & Associate Company, salient features of their financial statements for the financial year ended on March 31, 2021 and their contribution to the overall performance of the Company is attached as Annexure ‘AOC-I and Note 47 to the Consolidated Financial Statements of the Company for the reference of the members. The same is not being repeated here for the sake of brevity.

During the year under review, Lotus Hometextiles Limited ceased to be Associate Company of Trident Limited w.e.f. October 16, 2020.

DIRECTORS

Pursuant to provisions of Companies Act, 2013 (‘Act) and the Articles of Association of the Company, it is proposed to re-appoint Mr Rajinder Gupta (DIN: 00009037) Mr Deepak Nanda (DIN: 00403335) and Ms Pooja Luthra (03413062) as they are liable to retire by rotation and being eligible, offer themselves for re-appointment. The Nomination and Remuneration Committee and Board of Directors have recommended their re-appointment for the approval of the shareholders of the Company in the forthcoming Annual General Meeting of the Company.

Subsequent to the end of year under review, Ms Pallavi Shardul Shroff (DIN: 00013580), Independent Woman and Non-executive Director and Chairperson of the Company resigned from Directorship w.e.f. May 15, 2021. The Board places on record its appreciation for the services rendered by Ms Pallavi Shardul Shroff during her respective tenure as Chairperson and Director of the Company.

The Company has appointed Ms Usha Sangwan (02609263), as Additional Director in the category of Independent Woman and Non-executive Director of the Company for a period of 5 years w.e.f. May 15, 2021. Ms Usha Sangwan (02609263), being Additional Director, holds the office of Director till the date of forthcoming Annual General Meeting. The Company has duly received candidature for her regularization as a Director of the Company in the ensuing Annual General Meeting.

Further, the appointment of Ms Usha Sangwan as Independent Woman Director of the Company requires approval of shareholders in the ensuing Annual General Meeting. The Nomination & Remuneration Committee and Board of Directors have recommended the appointment of Ms Usha Sangwan as an Independent Director of the Company. In terms of Rule 8(5)(iiia) of the Companies (Accounts) Rules, 2014, the Board of Directors of the Company are of opinion that Ms Usha Sangwan possesses relevant expertise, integrity and experience requisite to be appointed as an Independent Director.

The Company has received declaration from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under the Act, SEBI (LODR) Regulations, 2015 and they are duly registered with the databank of Independent Directors as notified by Ministry of Corporate Affairs.

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

NUMBER OF BOARD MEETINGS

During the year under review, the Board duly met 6 times. The maximum gap between any two consecutive Board meetings does not exceed 120 days. The details of the Board meeting are set out in the Corporate Governance Report which forms part of this Report.

REVIEW OF PERFORMANCE OF THE BOARD

The Company has duly approved Nomination and Remuneration Policy prescribing inter-alia the criteria for appointment, remuneration and performance evaluation of the directors. As mandated by Section 134 & 178 read with Schedule IV of the Act and Regulation 25 of the SEBI (LODR) Regulations, 2015 as applicable on the Company, the Independent Directors in their separate meeting held on January 18, 2021 have reviewed the performance of Non-Independent Directors, Chairperson and Board as a whole alongwith review of quality, quantity and timeliness of flow of information between Board and management and expressed their satisfaction over the same.

Further the Board, in its meeting held on May 15, 2021 also reviewed the performance of the Board, its committees and all Individual Directors of the Company and expressed its satisfaction over the performance of the Board, its Committees and Individual Directors. Furthermore, Board is of the opinion that Independent directors of the company are persons of high repute, integrity & possess the relevant expertise & experience in their respective fields.

CONSERVATION OF ENERGY, TECHNOLOGY

ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Energy conservation continues to be an area of major emphasis in your Company. A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo, in accordance with Section 134(3)(m) of the Act, read with the Rule 8(3) of the Companies (Accounts) Rules, 2014, is annexed as Annexure I hereto and forms part of this report.

DISCLOSURE ON ESOP

The Company introduced Employees Stock Options Plan, 2007 in the financial year 2007-08, after approval by the shareholders by way of a special resolution dated June 29, 2007. The Company has made two grants under the scheme till date. The first grant was made on July 9, 2007 and second grant was made on July 23, 2009 by the Nomination and Remuneration Committee (earlier known as Compensation Committee) as per the terms & conditions of Trident Employee Stock Options Plan, 2007. The options were granted at the latest available closing market price prior to the date of meeting. As on March 31, 2021, there are no options outstanding under these grants.

The Company had also introduced Trident Employee Stock Options Scheme, 2009 and Trident Employee Stock Options Scheme, 2015, by way of trust route, after the approval of shareholders in their meeting held on August 27, 2009 and September 12, 2015, respectively. The Company has not yet implemented the said scheme and there has not been any grant under these both schemes till date.

Further, the Board of Directors and the Shareholders of the Company have approved a Scheme called as ‘Trident Limited Employee Stock Purchase Scheme – 2020 (‘Scheme) in their meeting held on May 16, 2020 and July 9, 2020 respectively. This scheme is effective from July 9, 2020. Pursuant to the Scheme, the Company has, constituted Trident Limited Employees Welfare Trust (‘Trust) to acquire, hold and allocate/transfer equity shares of the Company to eligible employees from time to time on the terms and conditions specified under the Scheme. However, no offer has been made to eligible employees under the Scheme till March 31, 2021.

The said trust has acquired Companys equity shares aggregated to 100,000,000 equity shares from the secondary open market. Since, no offer has been made to eligible employees under the Scheme till March 31, 2021, the disclosure in terms of Section 67 of the Act read with Rule 16 of the Companies (Share Capital and Debentures) Rules, 2014 is not applicable.

The disclosures as required under the SEBI (Share Based Employee Benefits) Regulations, 2014 has been given on the website of the Company under the following link: https:// www.tridentindia.com/statutory-disclosure

NOMINATION AND REMUNERATION POLICY

In compliance with Section 178 of the Companies Act, 2013, the Nomination and Remuneration Policy of the Company has been designed to keep pace with the dynamic business environment and market linked positioning. The Policy has been duly approved and adopted by the Board pursuant to recommendations of Nomination and Remuneration Committee of the Company and is duly available on the website of the Company at following link: https://www.tridentindia.com/code-policies

As mandated by proviso to Section 178(4) of the Companies Act, 2013, salient features of Nomination and Remuneration Policy are annexed as Annexure II hereto and forms part of this report.

FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS

The details of familiarization program for independent directors are provided in the Corporate Governance Report of the Company which forms part of this report.

STATUTORY COMMITTEES

The Company has duly constituted Board level Committees as mandated by the applicable laws and as per the business requirements. The details of the same are provided in the Corporate Governance Report of the Company which forms part of this report.

VIGIL MECHANISM & WHISTLE BLOWER POLICY

The Company has implemented Vigil Mechanism & Whistle Blower policy and the oversight of the same is with Audit committee of the Company. The policy inter-alia provides that any Directors, Employees, Stakeholders who observe any unethical behavior, actual or suspected fraud or violation of the Companys code of conduct or ethics, policies, improper practices or alleged wrongful conduct in the Company may report the same to Chairman of the Audit Committee or e-mail on the email-Id: whistleblower@tridentindia.com. Identity of the Whistle Blower shall be kept confidential to the greatest extent possible.

The detailed procedure is provided in the policy and the same is available on official website of the Company at following link: https://www.tridentindia.com/code-policies

During the year under review, there were no instances of fraud reported to the Audit Committee/ Board. Further, all recommendations of the Audit Committee were accepted by the Board.

CORPORATE SOCIAL RESPONSIBILITY 3CSR3 COMMITTEE & BUSINESS RESPONSIBILITY REPORT

CSR Committee comprises of Mr Rajiv Dewan (Chairman of the Committee), Mr Rajinder Gupta and Mr Deepak Nanda, members of the Committee. The disclosure of the contents of CSR Policy as prescribed and amount spent on CSR activities during the year under review are disclosed in ‘Annual Report on CSR activities annexed hereto as Annexure III and forms part of this report.

The Business Responsibility Report describing the initiatives taken by them from an environmental, social and governance perspective, in the specified format is included in the Annual Report of the Company.

RISK MANAGEMENT POLICY

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. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues. The Risk management framework has been provided in the Management Discussion and Analysis Report of the Company.

INTERNAL CONTROL

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed. The details of Internal Control System are provided in the Management Discussion and Analysis Report of the Company.

FIXED DEPOSITS

During the year under review, your Company has neither accepted any fixed deposits nor any amount was outstanding as principal or interest as on balance sheet date and disclosures prescribed in this regard under Companies (Accounts) Rules, 2014 are not applicable.

NO DEFAULT

The Company has not defaulted in payment of interest and/ or repayment of loans to any of the financial institutions and/ or banks during the year under review.

CORPORATE GOVERNANCE

Your Company is committed to adhere to the best practices & highest standards of Corporate Governance. It is always ensured that the practices being followed by the Company are in alignment with its philosophy towards corporate governance. The well-defined vision and values of the Company drive it towards meeting business objectives while ensuring ethical conduct with all stakeholders and in all systems and processes.

Your Company proactively works towards strengthening relationship with constituents of system through corporate fairness, transparency and accountability. In your Company, prime importance is given to reliable financial information, integrity, transparency, fairness, empowerment and compliance with law in letter & spirit. Your Company proactively revisits its governance principles and practices as to meet the business and regulatory needs.

Detailed compliances with the provisions of the SEBI (LODR) Regulations, 2015 and Companies Act, 2013 for the year 2020-21 are given in Corporate Governance Report, which is attached and forms part of this report. The certificate of Practising Company Secretary on compliance with corporate governance norms is also attached thereto.

HUMAN RESOURCES DEVELOPMENT AND INDUSTRIAL RELATIONS

The human resources development function of the Company is guided by a strong set of values and policies. Your Company strives to provide the best work environment with ample opportunities to grow and explore. Your Company maintains a work environment that is free from physical, verbal and sexual harassment. The details of initiatives taken by the Company for development of human resources are given in Management Discussion and Analysis Report.

The Company maintained healthy, cordial and harmonious industrial relations at all levels during the year under review.

AUDITORS & AUDITORS REPORT

M/s S.R. Batliboi & Co. LLP, Chartered Accountants, Statutory Auditors of the Company have submitted Auditors Report on the financial statements of the Company for the financial year ended on March 31, 2021. The Auditors Report for the year is self-explanatory & does not contain any modified opinion, hence need no comments.

COST AUDIT

The Board of Directors of your Company, on the recommendations of the Audit Committee, have reappointed M/s Ramanath Iyer & Co., Cost Accountants, New Delhi as cost auditors for the financial year 2021-22 to carry out an audit of cost records of the Company in respect of Textiles, Paper and Chemical divisions. The Cost Audit Report for the financial year ended March 31, 2021 is under finalization and shall be filed with the Central Government within the prescribed time limit.

SECRETARIAL AUDIT

M/s Vinod Kothari & Co., Company Secretaries, have submitted Secretarial Audit Report for the financial year 2020-21 and same is annexed as Annexure IV and forms part of this report. The Secretarial Audit Report for the year is self-explanatory & does not contain any qualification/ adverse remarks, hence need no comments.

ANNUAL RETURN

In terms of Section 92(3) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company is available on the website of the Company at the link: https://www. tridentindia.com/statutory-disclosure

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Particulars of loans, investments or guarantees have been disclosed in the financial statements and the Company has duly complied with Section 186 of the Companies Act, 2013 in relation to Loans, Investment and Guarantee during the financial year 2020-21.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the year under review with related parties were in the ordinary course of business and on an arms length basis. 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 and accordingly, the disclosures in Form No. AOC-2 is not applicable. The related party disclosures are provided in the notes to financial statements.

The Policy on Materiality of and Dealing with Related Party Transactions as approved by the Board is available on the official website of the Company at the following link: https://www.tridentindia.com/code-policies

The Company in terms of Regulation 23 of SEBI (LODR) Regulations, 2015, the Company submits the disclosures of Related Party on consolidated basis within 30 days from the date of publication of its standalone and consolidated financial results for the respective half year.

SECRETARIAL STANDARDS

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

RESPONSIBILITY STATEMENT OF DIRECTORS

Directors Responsibility Statement pursuant to the provisions of Section 134(3)(c) read with Section 134(5) of the Act on the annual accounts of the Company for the year ended on March 31, 2021 is provided below:

a) In the preparation of the annual accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departures from the same;

b) The Directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at end of the financial year and of the profit/loss of the Company for that period;

c) The Directors had 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 had prepared the annual accounts on a going concern basis;

e) The Directors had 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 had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

GENERAL

Your Directors state that no disclosure or reporting is required with respect to the following items as there were no transactions on these items during the year under review:

1. Material changes and commitments after the closure of the financial year till the date of this Report, which affects the financial position of the Company.

2. Change in the nature of business of the Company.

3. Details relating to deposits covered under Chapter V of the Act.

4. Issue of equity shares with differential rights as to dividend, voting or otherwise.

5. Issue of sweat equity shares to its Directors or Employees.

6. Any remuneration or commission received by Managing Director of the Company, from any of its subsidiary.

7. Significant or material orders passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

8. No fraud has been reported by the Auditors to the Audit Committee or the Board.

9. No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year alongwith their status as at the end of the financial year is not applicable; and

10. The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

ACKNOWLEDGMENTS

It is our strong belief that caring for our business constituents has ensured our success in the past and will do so in future. Your Directors acknowledge with sincere gratitude the co-operation and assistance extended by the Central Government, Government of Punjab, Government of Madhya Pradesh, Financial Institution(s), Bank(s), Customers, Dealers, Vendors and society at large.

Your Directors also wish to convey their appreciation for collective contribution & hard work of employees across all levels. The Board, also, takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders and their confidence in management and look forward to their continued support in future too.

For and on behalf of the Board
Rajiv Dewan Deepak Nanda
Chairman Managing Director
May 15, 2021 DIN: 00007988 DIN: 00403335