Vinyl Chemicals (I) Ltd Directors Report.

Your Directors present the Thirty Fourth Annual Report and the Audited Financial Statements for the year ended 31st March, 2020.

Financial Results:

(Rs in Lacs)
Particulars Current Year Previous Year
Profit before Interest, Depreciation and Tax 1004 1408
Less: Interest & Other Finance Costs 5 8
Depreciation * *
Profit before Taxation 999 1400
Less: Provision for Current Taxation 255 510
(Add)/Less: Provision for Deferred Tax (2) 4
Profit for the year 746 886
(Add)/Less: Other Comprehensive Income (4) (2)
Total Comprehensive Income 742 884
Add: Profit Brought Forward from Previous Year 4492 4138
Opening balance of Retained Earnings 5234 5022
Appropriations:
Dividend on Equity Shares # 440 @ 440
Tax on Dividend # 90 @ 90
Transfer to General Reserve $ Nil $ Nil
Total 530 530
Closing balance of Retained Earnings 4704 4492

* less than Rs.1 lac

# relates to Dividend for F.Y. 2018-19 @ relates to Dividend for F.Y. 2017-18

$ It is proposed not to transfer any amount to the General Reserve

Dividend: payment of dividend OutofCurrentYearsprofit, of Rs. 2.40 per equity share of Re. 1 each (previous year Rs. 2.40 per equity share) amounting to Rs. 4,40,09,066 (previous year Rs. 4,40,09,066) on 1,83,37,111 equity shares of Re. 1 each.

Performance: a. The companys current business is in Chemicals – which is trading mainly in Vinyl Acetate Monomer. b. During the year, the sales turnover from Trading activity was Rs. 36,109 lacs. c. During the year, the Company earned Net Profit of Rs. 746 lacs as against Rs. 886 lacs in the previous year.

Outlook:

The nationwide lockdown which was imposed due to the outbreak of Covid-19 pandemic has severely impacted the trading operations of the Company during the first quarter of the current financial year.

However, the Company expects to recover and perform reasonably well during the remaining three quarters of the financial year, subject to prevailing market conditions and fluctuations in exchange

Directors:

In accordance with the Articles of Association of the Company, Shri N.K. Parekh, a Director of the Company, retires by rotation and being eligible, offers himself for re-appointment.

Shri A.B. Parekh was appointed as an Additional Director by the Board of Directors on 28th January, 2020 based on the recommendation of Nomination and Remuneration Committee and he holds office upto the date of ensuing Annual General Meeting. The Company has received notice from a shareholder under

Section 160 of the CompaniesAct,2013proposinghiscandidaturefortheofficeof Director of the Company.

Members approval is sought for his appointment as a Director of the Company.

The Company has received declarations from Shri R.M. Gandhi, Smt. Y.J. Mogrelia and Shri A.D. Mavinkurve, Independent Directors, that they meet with the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations).

Extract of Annual Return:

Extract of Annual Return for the Financial Year ended on 31st March, 2020, as required under Section 92(3) of the Companies Act, 2013 is annexed as Annexure 1.

Number of Board Meetings:

During the year, the Board of Directors met 4 times. The details of Board Meetings are given in the Corporate Governance Report section of this Annual Report.

Particulars of Loans, Guarantees or Investments:

Particulars of Loans, Guarantees or Investments under Section 186 of the Companies Act, 2013 are given in the Notes forming part of the Financial Statements for the year ended 31st March, 2020.

Related Party Transactions:

All related party transactions that were entered into during the financialyear were on an arms length basis and in the ordinary course of business and were placed before the Audit Committee for approval. Particulars of arrangements with related parties as referred to in Section 188(1) of the Companies Act, 2013 for the Financial Year 2019-2020 are given in prescribed Form AOC - 2 which is annexed as Annexure 2. Disclosure of related party transactions with the promoter(s)/promoter group which individually hold 10% or more shareholding of the Company, as per Indian Accounting Standards, are set out in Note No. 33 of the Financial Statements of the Company.

The policy on Related Party Transactions as recommended by the Audit Committee and as approved by the Board is uploaded on the Companys website www.vinylchemicals.com.

Risk Management:

The Company has a structured Risk Management Plan. The Risk Management process is designed to safeguard the organization from various risks through adequate and timely actions.

Corporate Social Responsibility Report and Policy:

The Annual Report on CSR activities as required under Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure 3. The CSR Policy can be accessed on the Companys website www.vinylchemicals.com.

Remuneration Policy:

The Remuneration Policy of the Company is available on the Companys website www.vinylchemicals.com and is annexed as Annexure 4. There has been no change in the policy since the last financial year. The remuneration paid to the Directors are as per the terms laid out in the Remuneration Policy of the Company.

Committees of the Board:

The following statutory Committees constituted by the Board function according to their respective roles and defined scope: a. Audit Committee b. Nomination and Remuneration Committee c. Corporate Social Responsibility Committee d. Stakeholders Relationship Committee

Details of composition, terms of reference and number of meetings held during the year of the above Committees are given in the Corporate Governance Report section of this Annual Report. All recommendations made by the Audit Committee have been accepted by the Board.

Statutory Auditors:

There are no qualifications, reservations, adverse remarks or disclaimers made in the Auditors Report on the Financial Statements of the Company for the Financial Year ended 31st March, 2020.

During the year under review, the Auditors have not reported any matter under Section 143(12) of the Companies Act, 2013.

At the 33rd Annual General Meeting of the Company, the Members have appointed M/s Khanna & Panchmia,

Chartered Accountants, Mumbai as the Statutory Auditors for a second term of five consecutive years upto the conclusion of the 38th Annual General Meeting. The Auditors have confirmed that they are not disqualified from continuing as Auditors of the Company.

Subsidiaries, Associates and Joint Ventures:

The Company has no Subsidiaries, Associates and Joint Venture Companies.

Vigil Mechanism/Whistle Blower Policy:

The Company has established a Vigil Mechanism and adopted a Whistle Blower Policy for Directors and employees. The details of the policy are posted on the Companys website www.vinylchemicals.com.

Secretarial Audit Report:

Pursuant to Section 204 of the Companies Act, 2013, the Secretarial Audit Report for the year ended 31st March, 2020 given by M/s. M.M. Sheth & Co., Practicing Company Secretaries, is annexed as

Annexure 5. The report is unqualified.

Deposits:

The Company has not accepted any deposit covered under Chapter V of the Companies Act, 2013 during the year.

Internal Financial Controls:

Adequate internal financial control system and checks are in place commensurate with the size of the

Company and nature of its business.

Directors Responsibility Statement:

As required under the provisions of Section 134 of the Companies Act, 2013, your Directors state that:

in the preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanations relating to material departures, if any; the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2020 and of the profits of the Company for the year ended on that date;

the Directors have taken proper and sufficientcare for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; the Directors have prepared the annual accounts on a going concern basis;

the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively and

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

Corporate Governance:

Report on Corporate Governance in accordance with Regulation 34 read with Schedule V of the Listing Regulations alongwith a certificate from the Statutory Auditors of the Company is given separately in this Annual Report.

Management Discussion and Analysis Report:

Management Discussion and Analysis Report for the year under review as stipulated under the Listing Regulations is given in a separate section of this Annual Report.

Disclosure under Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014:

The information pursuant to Section 197 of the Companies Act, 2013 read with Rules 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors, Key Managerial Personnel and employees of the Company are annexed as Annexure 6.

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

The particulars under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, to the extent applicable to the Company, are given in the prescribed format which is annexed as Annexure 7.

Annual Evaluation by the Board:

The Board of Directors of the Company have carried out evaluation of its own performance, its Committees and individual Directors. The result of the evaluation is satisfactory, adequate and meets with the requirements of the Company.

Familiarisation Programme:

The Company has put in place a familiarisation programme for all its Directors including Independent Directors and the same is available on the Companys website www.vinylchemicals.com.

General: a) The Company has not issued Sweat Equity shares and Equity shares with Differential Rights during the Financial Year 2019-2020. b) The Company does not have Employees Stock Option Scheme. c) No Significant and Material Orders were passed by the Regulators against the Company during the

Financial Year 2019-2020. d) The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Act, 2013 and no complaints were received by the Company during the Financial Year 2019-2020 under the said Act. e) Apart from the impact of nationwide lockdown which was imposed due to outbreak of Covid-19 pandemic, which is dealt with elsewhere in this Report, there have been no material changes and commitments affecting the financial position of the Company after the end of financial year till the date of this Report. f) The Company has complied with the Secretarial Standards issued by Institute of Company Secretaries of India on Meetings of Board of Directors and General Meetings. g) The Central Government has not specified maintenance of cost records under Section 148(1) of the

Companies Act, 2013 for the Company.

Appreciation:

The Directors wish to place on record their appreciation of the contribution made by the employees at all levels to the working of the Company. The Directors also wish to place on record their appreciation for the shareholders, dealers, customers and banks for their continued support.

FOR AND ON BEHALF OF THE BOARD
Mumbai M.B. PAREKH
Date: 15th June, 2020 CHAIRMAN & MANAGING DIRECTOR