UFM Industries Ltd Directors Report.

Dear Shareholders,

Your Directors have pleasure in presenting the 33rdAnnual Report of the Company together with the Audited Balance Sheet as at 31st March, 2019 and the Statement of Profit & Loss for the year ended on that date.

financial performance

The highlights of the financial performance of the Company for the financial year ended 31st March, 2019 as compared to the previous financial year are as under:- Lakhs)

Your Directors have pleasure in presenting the 33 An Balance Sheet as at 31st March, 2019 and the Statements

financial performance

The highlights of the financial performance of the Com compared to the previous financial year are as under:

Particulars 2018-19 2017-18
Net Sales / Income 8,256.97 6849.36
Profit Before Depreciation, Interest, exceptional items & Tax 239.91 162.68
Less: Depreciation 26.66 27.44
Less: Interest and Finance Charges 65.36 55.74
Add: Exceptional Items - 0.30
Profit Before Tax 147.89 79.80
Less: Tax Expenses:
-Current Tax 21.84 19.04
-Income Tax for earlier years - 1.77
-Deferred Tax 19.77 (12.32)
Profit after Tax 106.28 71.31

Indian economy and industry at a glance

In FY 2018-19, the Indian economy began its journey of recovery from the temporary disruption caused due to demonetization and Goods and Services Tax and retained the position of the fastest growing economy and continued to be the fastest growing major economy in the world with the growth rate of approximately 7.5%.Today, we live in an increasingly uncertain world. The global economy is witnessing a whirlwind of events with significant implications for economies and businesses across the world. Volatility is at an all-time high with an impending Brexit and rise of protectionist tendencies in several advanced and emerging markets.

Although India is on a solid growth track, the new wave of globalization presents many opportunities and challenges that would require the attention of policy experts, industry leaders, academics and citizens alike.

Growth in the agriculture sector is expected to moderate as the Gross Value Added (GVA) at basic prices for the sector is estimated at 2.7% for 2018-19 on a high base of 5% in 2017-18. The Indian Meteorological Department has indicated that monsoons will not be abnormal in India during this year and this would assist in growth of the farming sector.

The agriculture sector is the backbone of our Indian economy which provides the basic ingredients to mankind and providing raw material for rapid industrialization sector development. The Government of India has introduced several projects to assist the agriculture sector. The Pradhanmantri Gram Sinchai Yojana aims to irrigate the field of every farmer and improving water use efficiency to achieve the motto Per Drop More Crop. Overall the scheme ensures improved access to irrigation. In 2018-19, Government of India is targeting foodgrain production of 285.2 million tonnes.

With 20 agri-climatic regions, all 15 major climates in the world exist in India. The country also possesses 46 of the 60 soil types in the world. India is the largest producer of spices, pulses, milk, tea, cashew and jute; and the second largest producer of wheat, rice, fruits and vegetables, sugarcane, cotton and oilseeds. Further, India is second in global production of fruits and vegetables, and is the largest producer of mango and banana.

The Indian food industry is poised for huge growth, increasing its contribution to world food trade every year due to its immense potential for value addition, particularly within the food processing industry. The Indian food and grocery market is the worlds sixth largest, with retail contributing 70 per cent of the sales.


The Indian food industry is still at a nascent stage and we expect it to record solid growth rates for several years to come. This represents a significant opportunity for your Company. With continued economic progress we expect to see strong robust growth in the Food Industry and we believe we are well poised to capture our share of this growth in a profitable manner. On the product side we see the emergence of consumers seeking both healthy and premium indulgence options and by ensuring that our portfolio includes offerings which address these consumers we are well placed to seize this opportunity. At the same time there will also still exists a huge opportunity in consumption amongst the emerging Indian Middle Class at a base consumption level seeking a broader variety in their existing food regimen in an affordable manner.

The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.


During the year under review, your Company manufactured 36435.49 MT of flour (Atta, Maida, Suji, Bran) as against 31,788.57 MT in previous Financial Year. Similarly, your Company has been able to achieve sales volume of 36059.99 MT of flour (Atta, Maida, Suji, Bran, and Wheat) as against 31,888.51 MT in previous Financial Year.


During the year under review, your company has been pursing with bulk consumers like biscuit, noodles and bakery segments to make contract agreements. However, we are hopeful of positive result in the next financial year. This will enable us to ramp up production. Logistics is becoming a major cost factor and we have to constantly change our strategy to minimize this cost.


In the coming years, India is expected to achieve the ambitious goal of doubling farm income. Increased investment activities such as irrigation facilities, warehousing and cold storage in agricultural infrastructure are likely to generate better momentum. Furthermore, the growing use of genetically modified crops will likely improve the yield for Indian farmers.

Going forward, the adoption of food safety and quality assurance mechanisms such as Total Quality Management (TQM) including ISO 9000, ISO 22000, Hazard Analysis and Critical Control Points (HACCP), Good Manufacturing Practices (GMP) and Good Hygienic Practices (GHP) by the food processing industry will offer several benefits


The paid up Equity Capital as on March 31, 2019 was Rs. 5,93,26,000/-. During the year under review, the Company has neither issued any shares with differential voting rights nor granted stock options or sweat equity shares.


In terms of requirement of section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual return in form MGT-9 is annexed herewith and marked Annexure-1.


The Board meets at regular intervals to discuss and decide on the policies and strategies with respect to the business of the Company apart from normal business. The Board generally meets at least once in every quarter to review the Quarterly results. Additional meetings are held as and when necessary.

All the meetings are scheduled well in advance and notices are sent to all the Directors at their address registered with the Company. The agenda of the meeting are backed by necessary supporting information and documents to enable the Board to take informed decisions. Agenda also includes minutes of the meetings of all the Board Committees for the information of the Board. Additional agenda items in the form of "Other Business" are included with the permission of the Chairman. Drafts minutes of the proceedings of the Board/ Committee Meetings are circulated in advance and comments, if any, received from the Directors are incorporated in the minutes in consultation with the Chairman. The Board periodically reviews compliance reports of all laws applicable to the Company. Information about major events/items is placed before the Board and approval of the Board is taken on all such matters wherever such approval is required. Senior executives of the Company are invited as and when required to provide additional inputs or clarifications required on agenda items being discussed in the Board Meeting.

During the year,five (5) Board Meetings of the Company were convened and held on 30th May 2018, 15th June 2018, 14th August 2018, 15th November 2018 and 14th February 2019. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

The Attendance at the Board Meetings during the financial year 2018-19 and at the previous Annual General Meeting is as under:

Name of Director No. of Board Meeting Attended Last AGM Attended
Mr. Mahabir Prasad Jain 4 Yes
Mr. Avishek Jain 4 Yes
Mrs. Tara Rani Jain 5 Yes
Mr. Deepak Ladia 5 No
Mr. Poonam Chand Deedwania 5 Yes


During the year under review, meeting of Independent Directors was held on 14th February, 2019 wherein the performance of the Non-Independent Directors and the Board as a whole was reviewed. The Independent Directors at their meeting also, inter alia, assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.


Currently, the Board has three Committees: Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee. The terms of reference of these Committees are determined by the Board and subject to be reviewed from time to time. Meetings of each of these Committees are convened by the respective Chairman of the Committee, who also informs the Board about the summary of discussions held in the Committee Meetings.

a. Audit Committee

The Audit Committee met 5 (five) times during the Financial year 2018-19. The Audit Committees composition meets the requirements of Section 177 of the Companies Act, 2013 and SEBI Regulations. The Members of the Audit Committee possess financial/ accounting expertise/ exposure. The meetings were held on 30th May 2018, 15th June 2018, 14th August 2018, 15th November 2018 and 14th February 2019. All the members of the Committee attended the meeting.

The Audit Committee comprises of the following members:

Name Mr. Deepak Ladia Category Non-Executive, Independent Designation Chairman
Mr. Poonam Chand Deedwania Non- Executive, Independent Member
Mrs. Tara Rani Jain Non-Executive, Non - Independent Member

Audit Committee meetings are attended by the Chief Finance Officer of the Company and Representatives of Statutory Auditors. The Company Secretary acts as the Secretary of the Audit Committee.

There has been no instance where the Board has not accepted the recommendations of the Audit Committee and Nomination and Remuneration Committee.

b. Nomination and Remuneration Committee

The Nomination and Remuneration Committee determines on behalf of the Board and shareholders as per agreed terms of reference, the Companys policy on specific remuneration packages for Executive Directors, Key Managerial Personnel and other employees. The Chairman of the Committee is an Independent Director and the Members of the Committee are Non - Executive Directors.

The Nomination and Remuneration Committee met on 30th May, 2018 during the financial year 2018-19. All the members of the Committee attended the meeting.

The composition of the Nomination and Remuneration Committee as at 31st March, 2019 is as under:

Name of the Member Mr. Deepak Ladia Category Non-Executive, Independent Designation Chairman
Mr. Poonam Chand Deedwania Non- Executive, Independent Member
Mrs. Tara Rani Jain Non-Executive, Non - Independent Member

c. Stakeholders Relationship Committee

In compliance with the provisions of Section 178 of the Companies Act, 2013 and the SEBI Regulations, the Board has constituted "Stakeholders Relationship Committee".

The Committees responsibility is to oversee Share Transfers and addressing to and redressal of shareholders grievances etc. The Committee also evaluates performance and service standards of the Registrar and Share Transfer Agents of the Company.

During the Financial Year 2018-19, no meeting of Stakeholders Relationship Committee was held.

The Composition of the Stakeholders Relationship Committee is given below:

Name of the Member Category Designation
Mr. Deepak Ladia Non-Executive, Independent Chairman
Mr. Poonam Chand Deedwania Non- Executive, Independent Member
Mrs. Tara Rani Jain Non-Executive, Non - Independent Member


The Company has formed a Whistle Blower Policy/ Vigil Mechanism as required under Section 177 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations, 2015. A Vigil (Whistle Blower) mechanism provides a channel to the employees and Directors to report to the management concerns about unethical behavior, actual or suspected fraud or violation of the Codes of conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said policy may be referred toat the Companys website at the web link:http://ufmindl.weebly.com/ uploads/8/7/1/1/8711000/whistle blower policy.pdf


The Board has framed a Remuneration Policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management Employees. The remuneration policy aims to enable the company to attract, retain and motivate highly qualified members for the Board and at other executive levels. The remuneration policy seeks to enable the Company to provide a well-balanced and performance- related compensation package, taking into account shareholders interests, industry standards and relevant Indian corporate regulations. The details on the same are given in the Corporate Governance Report.


Pursuant to requirement of Section 134 (3) (c) read with section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

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

• The Directors have selected such accounting policies and have 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 as at 31st March, 2019 and of the profit of the Company for the year under review.

• 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.

• The Directors have prepared the annual accounts ongoing concern basis.

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

• 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.


All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013. Mr. Deepak Ladia and Mr. Poonam Chand Deedwania are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfil the conditions specified in section 149 of the Act and the Rules made thereunder about their status as Independent Director of the Company.


In order to enable the Independent Directors to perform their duties optimally, the Board has devised a familiarization programme for the Independent Directors to familiarise them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. They are periodically updated about the development which takes place in the Company. The Independent Directors have been issued Letter of Appointment setting out in detail, the terms of appointment, duties, responsibilities and commitments etc. The familiarization program is available on the Companys website under the weblink:http://ufmindl.weebly.com/uploads/8/7/1/1/8711000/ familiarization programme.pdf


M/s. P. A. Agarwal & Co., Chartered Accountants (Firm Registration no. 327316E), Statutory Auditors of the Company, have been appointed by the members at the Thirty First Annual General Meeting and shall hold office for a period of 5 years from the date of such meeting held on 26th September, 2017.

The notes to the accounts referred to in the Auditors Report are self-explanatory and, therefore, do not call for any further comments.


Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Ms. Sushma Jain, a Company Secretary in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith markedAnnexure-2. The report is self-explanatory and do not call for any further comments.


During the year under review, your company has not given any loan or guarantee to any person falling under ambit of Section 186 of the Companies Act, 2013.

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


All related party transactions are entered on arms length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Accordingly, no transactions are being reported in Form AOC-2 in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014. However, the details of the transactions with the Related Party are provided in the Companys financial statements in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval has been obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

A policy on Related Party Transactions has been devised by the Company which may be referred to at the Companys website at the web link http://ufmindl.weebly.com/uploads/8/7/1/1/8711000/ related party policy.pdf


During the year under review no amount was transferred to reserves.


In order to conserve resources for future operations, your Directors do not recommend any dividend for the Financial Year 2018-19.


The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated in section 134 (3) (m) of the Act and rules framed there under is mentioned below:

(A) Steps taken toward Conservation of energy:

• We have replaced several light fittings with LED based lighting. This will reduce lighting cost significantly.

• We are taking good care of Motors and compressors so that they are never over heated with high current.

• Damaged Power factor capacitors have been replaced.

(B) Steps taken toward Technical Absorption:

• We have invited expert millers and company representative from BUHLER India, our machinery supplier to improve our systems. We have significantly improved our lab processes and systems. Hygiene in the production facility has been ramped up. Preventive maintenance has significantly reduced sudden breakdown causing production loss.

(C) Foreign Exchange Earnings And Outgo

During the period under review, there was no Foreign Exchange Earnings and Outgo.


Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has carried out the annual evaluation of its own performance, its Committees and Directors individually. A structured questionnaire was prepared after circulating the draft forms, covering various aspects of the Boardsfunctioning such as adequacy of the composition of the Board andits Committees, Board culture, execution and performance of specificduties, obligations and governance.

A structured questionnaire was prepared after taking into consideration 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.

The performance evaluation of the Independent Directors was completed. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.

The Directors expressed their satisfaction over the evaluation process and results thereof.


In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Avishek Jain will retire by rotation and being eligible, offers himself for reappointment. In view of his considerable experience, your Directors recommend his re-appointment as Director of the company.

There has not been any appointment/ retirement/ resignationof Key Managerial Personnel during the financial year ended 31stMarch, 2019.


The Company does not have any Holding, Subsidiary, Associate and Joint Venture.


During the year under report, the Company has not accepted any deposits from public or from any of the Directors of the Company or their relatives falling under ambit of Section 73 of the Companies Act, 2013.


During the year under review, there have been no material orders passed by the Regulators/Courts impacting materially the going concern status or future operations of the Company.

There were no material changes and commitments affecting the financial position of the Company during the period under review.


Internal Control Systems are designed to ensure the reliability of financial and other record and accountability of executive action to the managements authorization. The Statutory Auditors have evaluated the system of internal controls of the Company and have reported that the same are adequate and commensurate with the size of the Company and nature of its business.

The internal control systems are reviewed by the top Management and by the Audit Committee of the Board and proper follow up action ensured wherever required.


The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design or operations were observed.


The information required under Section 197 (12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 along with, a statement containing particulars of employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith and markedAnnexure- 3 and forms part of this report.


The Company has adopted a Policy on Prevention of Sexual Harassment as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("Sexual Harassment Act"). We affirm that adequate access has been provided to any complainants who wish to register a complaint under the policy. No complaint was received during the year.


Pursuant to the provisions of Regulation 15(2) of SEBI (Listing Obligations andDisclosure Requirements) Regulations, 2015, compliance with the provisions 17 to27 and clauses (b) to (i) of sub-regulation 46 and Para C, D and E of Schedule V ofthe Corporate Governance are not applicable to the Companies having paid upequity share capital not exceeding Rs. 10 Crore and Net Worth not exceedingRs. 25 Crore, as on the last day of previous financial year or on theCompanies listed on SME Exchange.

In view of above, as per the latest Audited Financial Statements of the Company asat March 31, 2019, the paid-up Equity Share Capital and the Net Worth of theCompany does not exceed the respective threshold limit of Rs. 10 Crore and Rs. 25Crore, as aforesaid; hence compliance with the aforementioned provisions of theCorporate Governance are not applicable to the Company


In pursuance of the SEBI Regulations, the Board has approved the Code of Conduct for Board of Directors and Senior Management and same has been posted on the Companys website www.ufmindl.weebly.com. The Directors and Senior Management personnel have affirmed compliance with the provisions of above Code of Conduct. The declaration by the Managing Director to this effect is also attached to this Report.


As required under Regulation 17(8) of the Listing Obligations and Disclosures Requirements formulated by Securities and Exchange Board of India (SEBI), the CEO/CFO certification has been submitted to the Board and a copy thereof is contained in this Annual Report.


The Company recognizes the need for continuous growth and development of its employees in order to provide greater job satisfaction and also to equip them to meet growing organizational challenges.

During the year under review, there has not been any material change in human resources, industrial relations and number of people employed.


Ministry of Corporate Affairs has permitted Companies to send copies of Annual report, Notices, etc., electronically to the email IDs of shareholders. Your Company has arranged to send the soft copies of these documents to the registered email IDs of the shareholders, wherever applicable. In case, any shareholder would like to receive physical copies of these documents, the same shall be forwarded upon receipt of written request in this respect.


Statements in this report describing the Companys objectives, expectations or predictions, may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. 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 incidental factors. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis, of any subsequent developments, events or information.


Your Directors take this opportunity to express their deep sense of gratitude to the Banks, Central and State Governments and their departments and the Local Authorities, Customers, Vendors, Business partners/ associates and Stock Exchanges for their continued guidance and support.

Your Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Company and recognize their contribution towards Companys achievements. Your Directors express their gratitude to the shareholders of the Company for reposing their confidence and trust in the Management of the Company.

For and on behalf of the Board of Directors
Place : Silchar Mahabir Prasad Jain Avishek Jain
Date : 14th August, 2019 Managing Director Director
DIN: 00498001 DIN: 01383018