VRL Logistics Ltd Directors Report.

Dear Members,

Your directors are pleased to present the thirty eighth annual report of your Company together with the audited financial statements for the financial year ended 31 March, 2021.

1. SUMMARY OF FINANCIAL RESULTS

The performance of the Company for the financial year ended 31 March 2021 is summarized below

(Rs.in lakhs)
Particulars Financial Year ended 31st March 2021 Financial Year ended 31st March 2020
Total Income 177,578.73 212,885.65
EBIDTA 26,035.04 30,858.48
Finance Costs 3,681.96 3,673.37
Depreciation & Amortization expense 15979.01 16,753.43
Profit Before Tax 6374.07 10,431.68
Tax Expense 1867.28 1,420.19
Net Profit After Tax 4506.79 9,011.49
Other comprehensive income (158.38) (204.92)
Total Comprehensive income 4,348.41 8,806.57
Basic& diluted Earnings per Share (Rs.) 4.99 9.97

2. OPERATING HIGHLIGHTS/STATE OF COMPANYS AFFAIRS

During the year under consideration, your Company achieved a gross revenue of Rs.177,578.73 lakhs as against Rs.212,885.65 lakhs for the earlier fiscal depicting a decline of 16.58 %.The Profit before tax (PBT) was Rs.6,374.07 lakhs as against Profit before tax of Rs.10,431.68 lakhs in the previous year depicting a decline of 38.90%. The same was owing to the pandemic affecting the companys business across the country.

While the Companys Goods Transport Division achieved a turnover of Rs.159,275 lakhs registering a decline of 7.61 % as compared to the previous year, Bus Operations division achieved a turnover of Rs.13,033.56 lakhs registering a decline of 62.08%. A detailed financial performance analysis is provided in the Management Discussion & Analysis Report, which is part of this Annual Report.

3. SHARE CAPITAL

During the year, the Company has not altered/modified the Authorised Share Capital of the Company. The paid up Equity Share Capital reduced from Rs.9034.35 lakhs to Rs.8834.35 lakhs due to Buy-back of 20,00,000 (Twenty Lakh) fully paid up Equity Shares having face value of Rs.10 (Rupees Ten only) each from its shareholders/beneficial owners (other than those who are promoters/ promoter group or person in control) from the open market through stock exchange mechanism at a volume weighted average price of Rs.253.36 (Rupees Two Hundred and Fifty Three and Thirty Six Paise).

The company has not issued shares with differential voting rights nor has granted any stock options or sweat equity. As on 31st March, 2021, none of the Directors of the company held instruments convertible into equity shares of the Company.

4. BUY BACK OF EQUITY SHARES

The Board of Directors of the Company at its meeting held on 6th February, 2021 approved the proposal of Buy-back by the Company of its fully paid up 20,00,000 (Twenty Lakhs) Equity Shares of the face value of Rs.10 (Rupees Ten Only) each from its shareholders/beneficial owners (other than those who are promoters/promoter group or person in control) from the open market through stock exchange mechanism i.e., using the electronic trading facilities of the stock exchanges where the Equity Shares of the Company were listed i.e., National Stock Exchange of India Limited ("NSE") and BSE Limited ("BSE") (collectively, "Stock Exchanges") for an aggregate amount not exceeding Rs.60,00,00,000 (Rupees Sixty Crores only), ("Maximum Buy-back Size"), and at a price not exceeding Rs.300 (Rupees Three Hundred Only) per Equity Share ("Maximum Buyback Price"), payable in cash (the process being referred hereinafter as "Buyback").

The Company completed the Buyback of 20,00,000 equity shares of the Company at a volume weighted average price of Rs.253.36 (Rupees Two Hundred and Fifty Three and Thirty Six Paise) thereby utilizing an amount of Rs.5,067.25 lakhs (excluding brokerage, costs, fees, turnover charges, taxes such as buyback tax, securities transaction tax, goods and services tax (if any) and income tax, stamp duty, advisors fees, printing expenses, filing fees and other incidental and related expenses and charges) (collectively referred to as "Transaction Costs") which represented 84.45% of the Maximum Buyback Size.

The Board also constituted a Buyback committee to execute necessary documentation, papers, announcements and to do other related things which were necessary to give effect to the said buyback.

The Committee comprised of 5 members viz., Dr. Vijay Sankeshwar, Chairman, Mr. Anand Sankeshwar, Mr. L R Bhat, Mr. Sunil Nalavadi and Mr. Aniruddha Phadnavis.

The said buyback commenced on 15th February, 2021 and was completed on 18th March, 2021. The Company extinguished all the 20,00,000 equity shares that were bought back within stipulated time frame in accordance with the extant provisions of applicable Securities Laws.

5. CHANGE IN THE NATURE OF BUSINESS

There is no change in nature of business of the Company. Your Company continues to be one of the leading Logistics service providers in the country. The service offerings of the Company in the Logistics space are Goods transport and Passenger transport apart from Transportation of Passengers by Air and Wind Power Generation business.

6. CAPITAL EXPENDITURE ON TANGIBLE ASSETS:

During the Financial year 2020-21, the company has incurred a capital expenditure of Rs.2779.80 Lakhs. Out of the same, an amount of Rs.1405.34 Lakhs was invested on purchase of new fleet i.e., predominantly on lorries, Vehicles (cars), Buses, Auto and Electric Autos. An amount of Rs.669.56 Lakhs was spent on Machineries predominantly relating to setting up of fire hydrant fixtures at Surat and Varur as also addition of forklifts and generators in a few transshipment hubs. A sum of Rs.704.90 Lakhs was incurred towards addition of other capex components which include the cost incurred on additions to Buildings, Furniture and Fixtures, Office Equipments and Leasehold Improvements etc.

7. TABLE LEASES LEASE

The Company had adopted the accounting standard Ind-AS 116 Leases, which had become effective from 1 April 2019. The adoption of this Standard has resulted in the Company recognizing a right-of-use (ROU) of assets and related lease liability in connection with all former operating leases except for those identified as low-value or having a remaining lease term of less than 12 months.

This year, the addition to ROU assets was to the tune of Rs.3,588.75 Lakhs attributable entirely to Buildings. Also the addition to Lease Liabilities, including both of current and Non-current nature was to the tune of Rs.3,706.49 Lakhs.

During the current year, in view of the raging COVID-19 pandemic and the nationwide lockdown announced by the Central Government on 24 March 2020, the operations of the Company were totally shut down during the month of April 2020. Concession of lease rent was sought from the lessors/licensors of the leased/licensed properties occupied by the Company across India for the month of April 2020. Several lessors/licensors assented to either a complete concession or partial lease rent concession, totally amounting to Rs.446.70 lakhs.

The impact of adopting IndAS 116 on the financial statements for the year ended 31 March 2021 is as follows:

(Rs in Lakhs)
Amounts recognized in statement of profit and loss For the year ended 31 March 2021 For the year ended 31 March 2020
Depreciation charge on Right-of-use assets-Buildings 6,542.61 6,441.05
Interest expense included in finance cost 2,353.77 2,521.24
Expense relating to short-term leases 2,915.39 3,843.23
Total cash outflow for leases during current financial year (excluding short term leases) 8,778.65 7,739.71
Additions to the right of use assets during the current financial year 12,197.92 5,181.03

8. DIVIDEND:

During the Financial year 2020-21, the Board recommend a final dividend at the rate of Rs.4.00/- per share for the fiscal. The record date for the purposes of the final dividend will be 31st July, 2021. The said final dividend, once approved by the shareholders, would be paid on or before 27th August 2021.

In compliance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), the Dividend policy of the Company is available on the Companys website at http:// vrlgroup.in/vrl_investor_desk.aspx?display=policies. A copy of the same is annexed to this Report as Annexure A.

The comparative details of dividend declared are as follows:-

Financial Year 2020-21

Financial Year 2019-20

Dividend Per share (in Rs) Dividend Payout (Rs in lakhs) Dividend Per share (in Rs) Dividend Payout (in Rs lakhs)
Interim Dividend - - 7.00 7623.97#
Final Dividend 4* 3533.74 - -
Total Dividend 4 3533.74 7.00 7623.97
Payout ratio (Interim and Final Dividend)

78.41%

64.52%

# Dividend payout as disclosed above includes dividend distribution tax also.

*Subject to approval of the shareholders at the ensuing Annual General Meeting of the Company.

9. TRANSFER OF UNPAID AND UNCLAIMED AMOUNT TO IEPF:

The Ministry of Corporate Affairs under Section 124 and 125 of the Companies Act, 2013 and Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), requires dividends that are not encashed/ claimed by the shareholders for a period of seven consecutive years, to be transferred to the Investor Education and Protection Fund (IEPF).

During the year under consideration, no amount was due for transfer to IEPF in accordance with Section 125 of the Companies Act, 2013.

The details of unclaimed dividend and IPO share application money along with their due dates for transfer to IEPF is provided in the Corporate Governance Report which forms part of this Annual Report and the same information has been uploaded on the website of the Company as stated link:

http://vrlgroup.in/investor_download/Unclaimed_Dividend_2020.pdf?a=1 .

10. TRANSFER TO RESERVES:

The Company has transferred an amount of Rs.450.68 lakhs to the General Reserve out of current years profits in line with its practice of earlier years.

11. SUBSIDIARY COMPANIES:

The Company does not have any subsidiary.

12. FIXED DEPOSITS

The Company has not accepted any deposits including from the public during the year within the meaning of Section 73 of the Companies Act, 2013 and the rules made there under.

13. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act,2013. Details of investments made by the company are given in the notes to the financial statements.

14. CREDIT RATING

During the year, ICRA Limited has reaffirmed its existing long term rating of [ICRA] A+ (pronounced as ICRA A Plus). The outlook on the long term rating is Stable.

15. MANAGEMENTS DISCUSSION AND ANALYSIS REPORT

Managements Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 (2) of SEBI Listing Regulations read with Schedule V thereto, is presented in a separate section forming part of this Annual Report.

16. BUSINESS RESPONSIBILITY REPORT

Securities Exchange Board of India vide recent notification mandated top 1,000 listed companies based on market capitalization to include a report on business responsibility. The said report is in compliance with the SEBI Listing Regulations which forms part of this Annual Report.

17. CORPORATE GOVERNANCE

The Company is committed to maintain the steady standards of corporate governance and adhere to the corporate governance requirements set out under extant law. The Report on corporate governance as stipulated under Regulation 34 of the SEBI Listing Regulations read with Schedule V thereto forms part of this Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance as stipulated under the aforesaid Regulations, as also the related certificate from CEO/CFO are attached to the Report on Corporate Governance.

The auditors certificate does not contain any qualification, reservation or adverse remarks.

18. BOARD COMPOSITION AND INDEPENDENCE

The composition of the Board is in conformity with Section 149 of the Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations, which stipulates that the Board should have optimum combination of Executive and Non-executive Directors with at least one Independent Woman Director and at least 50% of the Board should consist of Independent directors, as the Chairman of our Board is an Executive Director.

As on 31 March, 2021, the Board comprised of twelve Directors. Out of these, two are Managing Directors who are also the Promoters of the Company and two are Whole Time Directors, the other eight being Non-Executive Directors.

Of the eight Non-Executive Directors, six are Independent Directors. These include two Independent Woman Directors. All the Directors possess the requisite qualifications, expertise and experience in general corporate management, finance, banking, laws and other allied fields enabling them to contribute effectively in their capacity as Directors of the Company.

None of the Directors of the Company are related to each other except Dr. Vijay Sankeshwar, Chairman & Managing Director (CMD) and Mr. Anand Sankeshwar, Managing Director (MD).

All Independent Directors have given due declarations that they meet the criteria of independence as laid down under section 149 (6) and (7) of the Companies Act, 2013 and under extant provisions of the SEBI Listing Regulations.

The Independent Directors of the Company have registered themselves with the Indian Institute of Corporate Affairs (‘IICA) towards the inclusion of their names in the data bank maintained with it and have successfully undertaken the proficiency self-assessment test as mandated.

19. NUMBER OF MEETINGS OF THE BOARD

During the year, four Board Meetings were held, details of which are provided in the Corporate Governance Report. The intervening gap between the Meetings was in compliance with the requirements of the Companies Act, 2013 and SEBI Listing Regulations and in line with the relaxation in such time gap as permitted by SEBI vide its Circular SEBI/HO/CFD/CMD1/ CIR/P/2020/38 dated 19.03.2020 and MCA, vide its General Circular No. 11/2020 dated 24.03.2020.

Details of attendance of meetings of the Board, its Committees and the Annual General Meeting are included in the Report on Corporate Governance, which forms part of this Annual Report.

20. COMMITTEES OF THE BOARD

The Board has the following committees:

a. Audit Committee

b. Nomination and Remuneration Committee

c. CSR Committee

d. Stakeholders Relationship Committee

e. Risk Management Committee

f. Administration Committee

g. Finance Committee

h. Buy Back Committee (Formed for the specific purpose for Buy back of Equity shares)

Details such as terms of reference, powers, functions, meetings, membership of committee, attendance of directors etc. are dealt with in Corporate Governance Report forming part of this Annual report.

Board has accepted all recommendations made by the Audit Committee during the year.

21. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

a) Inductions

There was no induction of any new Director/KMP during the year under consideration.

b) Retirement/Re-appointment

Mr. L R Bhat, Executive Director and Dr. Ashok Shettar, Non-Executive Director of the Company, retire by rotation owing to their tenure being the longest amongst retiring directors and being eligible, offer themselves for reappointment. The Board recommends their re-appointment.

c) Resignation

Not Applicable.

KEY MANAGERIAL PERSONNEL

Pursuant to Section 203 of the Companies Act, 2013, the Key Managerial Personnel (KMP) of the Company are Dr. Vijay Sankeshwar, Chairman and Managing Director, Mr. Anand Sankeshwar, Managing Director, Mr. K N Umesh, Whole time Director, Mr. L R Bhat, whole time Director, Mr. Sunil Nalavadi, Chief Financial Officer and Mr. Aniruddha Phadnavis, Company Secretary. There was no change in Key Managerial Personnel of the Company during the year. The remuneration and other details of these Key Managerial Personnel for FY 2020-2021 are provided in the Annual Return (MGT 7) which is available on the website of the Company and can be accessed at https://www.vrlgroup.in/vrljnvestor_desk.aspx?display=annual_return.

22. STATUTORY DISCLOSURES

None of the Directors of your Company are disqualified as per provisions of Section 164(2) of the Companies Act, 2013. Your Directors have made necessary disclosures, as required under various provisions of the Companies Act, 2013 and SEBI Listing Regulations. A Certificate to that effect as mandated under Schedule V of the SEBI (LODR) Regulations, 2015 has been obtained from a Company Secretary in practice.

23. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and SEBI Listing Regulations, the annual performance of the Board, its Committees, Chairperson and Individual Directors including Independent Directors was evaluated as per the criteria laid down by the Nomination and Remuneration Committee. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report which forms part of this Annual Report.

24. BOARD DIVERSITY

A diverse Board enables efficient functioning through differences in perspective and skill and also fosters differentiated thought processes at the back of varied industrial and management expertise, gender and knowledge. The Board recognizes the importance of a diverse composition and has adopted a Board Diversity policy which sets out the approach to diversity.

The said policy can be accessed through the following link. http://vrlgroup.in/vrl_investor_desk.aspx?display=policies

25. DIRECTORS RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

i) In the preparation of the annual accounts, the applicable accounting standards (IndAS) have been followed along with proper explanation relating to material departures. The Ind AS are prescribed under Section 133 of the Companies Act, 2013, read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period.

iii) 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.

iv) The directors have prepared the annual accounts on a going concern basis.

v) 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.

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

vii) Based on the framework of internal financial controls established and maintained by the Company, work performed by the internal, statutory auditors, reviews performed by the management and the relevant Board Committees, the Board, in concurrence with the Audit Committee, is of the opinion that the Companys internal financial controls were adequate, operational and effective as on 31 March, 2021.

26. RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financial year were on arms length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large.

All Related Party Transactions are placed before the Audit Committee as also to the Board for prior approval. Omnibus approval was obtained every half year for transactions which are repetitive in nature. A statement containing details of all transactions entered into pursuant to omnibus approval are placed before the Audit Committee and the Board for review and approval on a quarterly basis.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board of Directors of the Company can be viewed on the website of the Company through the following link.http://vrlgroup.in/investor_download/RPT%20Policy.pdf

There were no material related party transactions entered between the Company, Directors, management, or their relatives. All the contracts/arrangements/ transactions entered into by the Company with the related parties during the financial year 202021 were in the ordinary course of business and on an arms length basis. In our opinion there were no "material" transactions that warrant a disclosure in this report.

Accordingly, particulars of contracts or arrangements with related parties referred to in Section 188(1) along with the justification for entering into such contract or arrangement in Form AOC-2 does not form a part of this report.

27. NOMINATION AND REMUNERATION POLICY

In adherence to Section 178(1) of the Companies Act, 2013, the Board has, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management and their remuneration including criteria for determining qualifications, positive attributes and other matters provided under sub section (1) (3) of section 178 of the Companies Act 2013. The Remuneration Policy is annexed to this report as Annexure B. The said policy alternatively can also be accessed on the website of the Company at the following link:http://vrlgroup.in/investor_download/Nomination_Remuneration%20Policy.pdf

28. CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and specified employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings/behavior in any form and the Board has laid down certain directives to counter such acts. Such code of conduct has also been placed on the Companys website. The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The Code gives guidance on the expected behavior from an employee in a given situation and the reporting structure. All the Board Members and the Senior Management personnel have confirmed compliance with the Code. Pursuant to SEBI (LODR) Regulations, 2015, a confirmation from the Managing Director regarding compliance with the Code by all the Directors and senior management of the Company is given as a part of the Annual Report.

29. VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism Policy in line with the provisions of Section 177(9) and Section 177(10) of the Companies Act, 2013 to deal with instances of fraud and mismanagement, if any. Staying true to our core values being committed to high standards of Corporate Governance and stakeholder responsibility, the said policy ensures that strict confidentiality is maintained in respect of whistle blowers whilst dealing with concerns and also specified that no discrimination will be meted out to any person for a genuinely raised concern and also provides a direct access to the Chairman of the Audit Committee. During the year under review none of the personnel has been denied access to the Chairman of Audit Committee.

The Vigil Mechanism policy is available on the website of the Company and can be accessed at the following link.

http://vrlgroup.in/investor_download/vigil_Mechanism.pdf.

30. PREVENTION OF INSIDER TRADING

In terms of the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended (PIT Regulations), the Company has adopted a Code of Internal Procedures and Conduct for Regulating, Monitoring and Reporting of Trading by Insiders with a view to regulate trading in securities by the Directors and certain designated employees of the Company. The Code requires pre-clearance for dealing in the Companys shares and prohibits the purchase or sale of Company shares by the Directors and designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code.

The said code is available on the website of the Company and can be accessed at the following link. http://vrlgroup.in/ vrl_investor_desk.aspx?display=policies

31. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The Board of the Company had laid down policies, guidelines, procedures and structure to enable implementation of appropriate internal financial controls across the Company. These control processes enable and ensure the orderly and efficient conduct of Companys business, including safeguarding of assets, prevention and detection of frauds and errors, the accuracy and completeness of the Accounting records and timely preparation & disclosure of financial statements. These controls also identify the risks and provides for means to minimize/mitigate the risks affecting the business of the Company as a whole. Auditors, as required under the Companies Act 2013, have also reported the existence and operations of these controls in an effective manner.

The Companys internal audit department enables the Management to mitigate the risks and prevent non-compliance with laws which would affect the financial position of the Company. The scope and authority of the Internal Audit function is well defined and to maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board as well as directly to the Chairman & Managing Director. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the internal audit report from time to time, the management undertakes corrective actions in the relevant areas and thereby strengthens the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee.

32. BUSINESS RISK MANAGEMENT

Pursuant to Section 134(3)(n) of the Companies Act, 2013 and Regulation 17(9) of SEBI (LODR) Regulations, 2015,the Company has in place a risk management architecture that provides a holistic approach to the best of its capabilities. The Company identifies, assesses and mitigates risks that could materially impact its performance in achieving the stated objectives.

The Risk Management Committee and Audit Committee, on a regular basis, reviews the Companys portfolio of risks and examines it under the light of the Companys Risk Appetite.

The material risks affecting Company are identified along with related mitigation measures and elaborated in the Risk Management Policy of the Company which has also been hosted on the website of the Company and can be accessed at the following link.

http://vrlgroup.in/investor_download/Risk%20Management%20Policy.pdf

33. SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015

The Companys Equity Shares are listed on the BSE Ltd and National Stock Exchange of India Limited. and has paid applicable Annual listing fee to these stock exchanges. The Company has also formulated the following Policies as required under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015:

‘Policy for Preservation of Documents under Regulation 9 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The said policy can be accessed at the following link: http://vrlgroup.in/vrl_investor_desk.aspx?display=policies

‘Policy on Criteria for determining Materiality of Events/Information under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

The said policy can be accessed thru the following link: http://vrlgroup.in/vrl_investor_desk.aspx?display=policies

34. AUDITORS and AUDIT REPORTS

a) Statutory Auditors and Audit Report:

In accordance with Section 139 of the Companies Act, 2013 and Rules made thereunder, Members at the 37th Annual General Meeting of the Company approved the appointment of Statutory Auditors, M/S. Kalyaniwalla & Mistry LLP Chartered Accountants, Mumbai (Firm Registration No. 104607W/W100166) for a period of 5 years from the date of the said Annual General Meeting.

There are no qualifications, reservations or adverse remarks made by the Statutory Auditors in their report for the financial year ended 31 March, 2021. Pursuant to provisions of section 143 (12) of the Companies Act 2013, the Statutory Auditors have not reported any incident of fraud to the Audit Committee during the year under review.

b) Cost Auditors & Cost Audit Report

Section 148 (1) of the Companies Act 2013 read with Rules made thereunder mandates every Company belonging to category prescribed in the Rules to undertake a Cost Audit. In compliance with said provision, Company had appointed M/s S.K. Tikare & Co., Cost Accountants, Belagavi, to audit the cost records for FY 2020-21 pertaining to its Wind Power division. The Cost Auditor has submitted the Cost Audit report for FY 2020-21 and the same is annexed as Annexure C herewith.

There are no qualifications, reservations or adverse remarks made by the Cost Auditors in their report for the financial year ended 31st March, 2021.

Pursuant to the recommendation of the Audit Committee, the Board of Directors have re-appointed M/s S K Tikare & Co., Cost Accountants, Belagavi, as the Cost Auditors for FY 2021-22 at a remuneration of Rs.70,000/-, excluding applicable taxes, subject to approval by the members at the ensuing Annual General Meeting of the Company.

c) Secretarial Auditor & Secretarial Audit Report

Pursuant to provisions of section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the company has appointed Mr. R Parthasarathi, Company Secretary in practice to undertake the Secretarial Audit of the Company for FY 2020-21. The Secretarial Audit report in Form MR-3 is annexed herewith as Annexure D.

There are no qualifications in the Secretarial Audit report for the financial year ended 31st March, 2021.

Pursuant to the recommendation of the Audit Committee, the Board of Directors have re-appointed Mr. R Parthasarathi, Company Secretary to conduct the Secretarial Audit for FY 2021-22 at its meeting held on 12th June, 2021 as also to issue the applicable Secretarial Compliance Report to be submitted to the Stock Exchanges.

35. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

As required under the provisions of the section 135 of the Companies Act 2013, the Board has constituted the Corporate Social Responsibility Committee which monitors and oversees various CSR initiatives and activities of the Company. The CSR Committee comprises of five directors out of which two are Independent Directors. The CSR Committee met two times during the year. Further details such as composition, terms, functions, meetings and attendance of directors of the said committee are provided in the Corporate Governance report forming part of this Annual Report.

The Company has undertaken and contributed to various projects identified by the other Trusts/Educational Institutions for CSR related activities as approved by the CSR Committee during the year mainly towards Education, Healthcare and Sports, etc.

A detailed Annual Report as required to be given under Section 135 of the Companies Act, 2013 and Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 containing details of CSR activities & contents of CSR policy is annexed as Annexure E.

CSR policy of the Company is available on the Companys website and can be accessed through the following link. http:// vrlgroup.in/investor_download/CSR%20POLICYpdf

36. ANNUAL RETURN:

A copy of the Annual Return of the Company containing the particulars prescribed u/s 92 of the Companies Act, 2013, in Form MGT-7, as of the end of the financial year i.e. 31st March, 2021 is uploaded on the website of the Company in the Investor Relations Section under the tab ‘Annual Return and can be accessed at https://www.vrlgroup.in/vrl_investor_desk. aspx?display=annual_return.

37. DETAILS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and expenditure are annexed hereto as Annexure F and forms part of this Report.

38. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, forms of this report and annexed herewith as Annexure G.

A statement containing top ten employees in terms of remuneration and the names of every employee who was in employment of the Company throughout the year and was in receipt of the specified remuneration is also included therein.

39. COMPLIANCE WITH SECRETARIAL STANDARDS

The Company is in compliance with applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

40. MATERIAL CHANGES AND COMMITMENTS

Barring the adverse financial impact arising out of the COVID-19 pandemic, there were no other material changes and commitments that occurred subsequent to the end of the financial year till the date of this report, which affects the financial position of the Company.

The impact of Covid-19 on the Logistics Industry has been severe in the first quarter of the current fiscal (FY 2021-22) where the entire industry was facing labour shortages, cargo capacity challenges, a manufacturing slowdown, order delays and stuck shipments, and demand and supply shocks. Due to the States imposing lockdowns, the brick and mortar industries activities were affected across the country leading to reduced freight volumes for logistics services.

The situation is similar to the one we faced in the year gone by. After a dismal financial performance in the first quarter, your company bounced back strongly in the subsequent three quarters not only recouping he losses incurred in the first quarter, but also generating high operational margins and recording a decent profit for the year as a whole. Your company continued to have decent cash profits even during this tough year. This was possible as the company could garner additional freight volumes hitherto being carried by small and unorganized players across the country who could not emerge out of the adverse financial impact caused by the pandemic.

The pandemic has impacted one and all and as aptly demonstrated during the fiscal gone by, your Companys business model has sufficient resilience to bear its brunt as also grab freight opportunities in its aftermath.

41. INDUSTRIAL RELATIONS

During the year under review, your Company experienced cordial relationship with workers and employees at all levels, throughout the year.

42. SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting going concern status and companys operations for a foreseeable future.

43. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT 2013

The Company has in place a Policy for Prevention Prohibition and Punishment of Sexual Harassment of Women at Work place in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees are covered under this policy. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The details of complaints received and disposed off during the financial year 2020-21 is as follows:

No. of complaints filed during the year No. of complaints disposed off during the year No. of complaints pending
Nil Nil Nil

44. DISCLOSURES PURSUANT TO COMPANIES (ACCOUNTS) AMENDMENT RULES, 2021

• There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which materially impact the business of the Company.

• There was no instance of one time settlement with any Bank or Financial Institution.

45. ACKNOWLEDGMENTS AND APPRECIATION

The Directors take this opportunity to thank the Companys customers, shareholders, Investors, suppliers, bankers, financial institutions and Central & State Governments for their consistent support and cooperation extended to the Company. The Directors also wish to place on record their appreciation towards employees at all levels for their hard work, dedication and commitment.