To the Members,
The Directors of EPL Limited ("the Company"/ "EPL") hereby present the Annual Report of the Company along with the Audited Standalone and Consolidated Financial Statements for the Financial Year ended on March 31, 2024 ("Financial Year 2023-24"/ "year under review"). The consolidated performance of the Company and its subsidiaries has been referred to wherever required.
1. FINANCIAL RESULTS
{Rs. In Million)
Standalone
Consolidated
Note: ^Financial Year ended on March 31,2023 is referred as "Financial Year 2022-23" or "previous year".
2. COMPANY'S PERFORMANCE - FINANCIAL YEAR 2023-24 Business Performance
Key Highlights of the performance of the Company, including the review of market, business and operations of the Company, during the year under review, are included in the 'Management Discussion and Analysis', which forms part of the Annual Report separately.
Financial Performance
On a Standalone Basis, the Total Income for the year under review was Rs. 13,592 Million, which was -2.1% higher over the previous year's Total Income of Rs. 13,311 Million, with the Sales and Operating Income having grown by -5.9%. The Net Profit After Tax for the year under review was Rs. 1,763 Million, which was -14.4% lower as compared to Net Profit After Tax of Rs. 2,059 Million in the previous year. This was primarily due to one-time tax reversals in the previous year.
On a Consolidated Basis, the Total Income for the year under review was Rs. 39,755 Million, which was -6.4% higher over the previous year's Total Income of Rs. 37,362 Million, with the Sales and Operating Income having grown by -6%. The Net Profit After Tax for the year under review was Rs. 2,101 Million, which was -8.9% lower as compared to Net Profit After Tax of Rs. 2,307 Million in the previous year. This was primarily due to one-time tax reversals in the previous year in India.
In compliance with the applicable provisions of the Companies Act, 2013 read with the rules made thereunder (as amended) ("Act") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended) ("SEBI LODR Regulations"), the Audited Standalone and Consolidated Financial Statements of the Company for the year under review, form part of this Annual Report separately, along with the respective Auditors' Reports thereon.
Exceptional Items
For the year under review, following exceptional items were recorded, on a Consolidated Basis:
- Due to the prevailing economic situation and significant devaluation of currency in Egypt, EPL MISR for Advanced Packaging
S.A.E. ("EPL MISR"), a subsidiary of the Company in Egypt, incurred foreign exchange loss (net) amounting to Rs. 465 Million;
- Owing to restructuring of its operations in Europe region, the Company incurred a cost of Rs. 140 Million;
- Tubopack de Colombia S.A.S, a wholly-owned step-down subsidiary of the Company registered in Colombia, completed its voluntary dissolution process on June 30, 2022. Accordingly, an exceptional loss of Rs. 11 Million for the year ended March 31, 2023, representing exchange difference arising on translation of foreign operations, was reclassified to the profit and loss in accordance with Indian Accounting Standard (Ind AS) 21.
More details in this regard are included in the Audited Consolidated Financial Statements of the Company for the year under review, which form part of the Annual Report separately.
There were no exceptional items recorded in the Audited Standalone Financial Statements of the Company for the year under review.
Intellectual Property Rights
During the year under review, the Company filed 20 applications for registration of patents in various Countries, including 3 in India, which are under process of registration. Further, during the year under review, 27 patents were granted to the Company in various Countries, including 4 in India, applications for registration of which were filed by the Company during previous financial years.
Further, during the year under review, the Company did not file any application for registration of Trademarks.
Significant or Material Orders
During the year under review, no significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status operations of the Company in future.
Applications made or proceedings initiated in terms of the provisions of Insolvency and Bankruptcy Code, 2016 ("IBC"
During the year under review, the Company did not initiate any proceeding in terms of the provisions of IBC and similarly, no proceedings were initiated against the Company.
3. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial position of the Company that have occurred between March 31, 2024 i.e. end of the year under review and May 28, 2024 i.e. the date on which the Audited Standalone and Consolidated Financial Statements of the Company, for the year under review, were approved by the Board of Directors of the Company ("Board") at its meeting and the date on which the respective Auditors' Reports thereon were issued.
4. DIVIDEND
The Board has recommended a Final Dividend of Rs. 2.30 per fully paid-up Equity Share of Rs. 2 each, for the Financial Year 2023-24 (vis-a-vis the Final Dividend of Rs. 2.15 per Equity Share of Rs. 2 each, for the Financial Year 2022-23). The Final Dividend, if approved by the Shareholders of the Company at the ensuing Annual General Meeting, scheduled to be held on Wednesday, August 21,2024 ("ensuing AGM"), will be paid to the Equity Shareholders holding Equity Shares of the Company as on August 14, 2024 i.e. the cutoff date decided for the purpose. Further, the Register of Members and Share Transfer Books of the Company will remain closed from August 15, 2024 to August 21,2024 (both days inclusive).
The Final Dividend, if approved by the Shareholders at the ensuing AGM, will be paid on or before September 19, 2024, after deduction of tax at source as may be applicable. If approved, the Final Dividend would result in a cash outflow of -Rs. 73.23 Crore. The proposed Final dividend on Equity Shares is 115% of the paid-up value of each Equity Share (vis-a-vis 107.5% for the Financial Year 2022-23) and the total pay-out of Final Dividend shall be ~41.50?/o (Previous Year: ~ 33.23%) of the Profit After Tax of the Company, for the year under review, on Standalone basis.
The abovementioned Final Dividend will be in addition to the Interim Dividend of Rs. 2.15 per fully paid-up Equity Share of Rs. 2 each, which was declared by the Board at its meeting held on November 8, 2023 and which was paid to the Equity Shareholders whose names appeared in the Register of Members as on November 21,2023 (i.e. the cut-off date determined for the purpose).
Accordingly, the total dividend for the Financial Year 2023-24 including the proposed final dividend would be Rs. 4.45 per fully paid-up Equity Share of Rs. 2 each i.e. ~222.50/o of the paid-up value of each Equity Share.
The Board has adopted the Dividend Distribution Policy in terms of the provisions of the SEBI LODR Regulations and the same is available on the website of the Company i.e. at https://www.eplglobal.com/investors/corporate-governance/.
5. TRANSFER TO RESERVES
The Board has not proposed to transfer any amount to reserves during the year under review and accordingly, the entire amount of profit for the Financial Year 2023-24 would be retained in the statement of profit and loss.
6. SHARE CAPITAL
During the year under review, there were no changes in the Authorised Capital of the Company and accordingly, at the end of the Financial Year 2023-24, the Authorised Capital of the Company was Rs. 73.15 Crore (divided into 36,57,50,000 Equity Shares of Rs. 2 each).
During the year under review, 1,69,017 Equity Shares, fully paid up, were issued and allotted pursuant to the exercise of Stock Options granted to eligible employees of the Company, as per the provisions of the Employee Stock Options Scheme-2020 of the Company ("ESOS 2020"). Accordingly, the Paid-up Equity Share Capital of the Company, as at the end of Financial Year 2023-24 was Rs. 63,67,57,764 (comprising 31,83,78,882 Equity Shares of Rs. 2 each).
7. ISSUANCE OF SECURITIES Equity Shares
As mentioned above, during the year under review, 1,69,017 Equity Shares, fully paid up, were issued and allotted pursuant to the exercise of Stock Options granted to eligible employees of the Company, as per the ESOS 2020.
The ESOS 2020 was approved by the Board on May 22, 2020 and by the Shareholders on July 1, 2020, vide a Postal Ballot. It is applicable to the employees of the Company & its subsidiaries and its provisions do not extend to the Promoter(s) or those belonging to the Promoter Group or to any Director of the Company, who either directly or indirectly, through relatives or body corporate holds more than 10% of the outstanding Equity Shares of the Company, if any.
Relevant details on the Stock Options granted and related accounting matters in that regard are set out in the Notes to the Audited Standalone Financial Statements for the year under review, which form part of the Annual Report separately.
The Nomination and Remuneration Committee of the Board ("NRC") inter alia administers and monitors the ESOS 2020, as per the applicable provisions of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (as amended) ("SEBI SBEB Regulations"). The Scheme is in compliance with applicable laws and during the year under review, there was no modification in the Scheme. The disclosure relating to the Scheme and other relevant details, as prescribed under the SEBI SBEB Regulations are available on the website of the Company i.e. at https://www.eplglobal.com/investors/corporate- governance/.
Credit Rating
During the year under review, Credit Rating(s) for long term bank facilities and short term bank facilities were re-affirmed and maintained at CARE AA+ with Stable Outlook (Double A plus; Outlook: Stable) and CARE A1+, respectively. Additionally, India Rating and Research (Fitch) affirmed the issuer rating of the Company at IND AA+ with Stable Outlook during the year under review. Further, the Company continues to enjoy IND A1+ rating in respect of commercial paper. More details in this regard are suitably disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
Other Disclosures
In terms of the other applicable provisions of the Act, it is reported that, during the year under review:
• the Company did not issue any shares with differential voting rights;
• the Company did not issue any sweat equity shares;
• the Company fully redeemed the Non-Convertible Debentures ("NCDs") of Rs. 20 Crores (issued under Series C, under ISIN: INE255A08AY7) on June 13, 2023, along with the due interest thereon; and
• the Company did not issue any NCDs and Commercial Paper(s).
8. INVESTOR EDUCATION AND PROTECTION FUND ("IEPF")
In terms of the applicable provisions of the Act, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (as amended) ("IEPF Rules"), all dividends which are lying unpaid or unclaimed for a period of 7 (seven) years, are required to be transferred by the Company to the IEPF, established by the Government of India, after completion of 7 (seven) years. Further, in terms of the IEPF Rules, the shares on which the dividend has remained unpaid or unclaimed for 7 (seven) consecutive years or more shall also be transferred to the demat account of the IEPF Authority.
During the year, the Company transferred an amount of Rs. 17,54,564, representing the unclaimed and unpaid dividend pertaining to Financial Year 2015-16 to the IEPF. Further, 38,342 Equity Shares of the Company, to which such dividend pertained, were also transferred to IEPF Authority, as per the requirements of the IEPF Rules.
Details of the unpaid/ unclaimed dividend along with the names of the Shareholders to whom such dividend pertains, are available on the website of the Company i.e. at https://www.eplglobal.com/investors/shareholder-information/.
9. CORPORATE GOVERNANCE
As a global organisation, the Company is committed to adhere with the highest standards of Corporate Governance practices at all times and accordingly, the principles of Corporate Governance have been implemented in all facets of the operations of the Company.
The Company is in compliance with the Corporate Governance requirements stipulated under the Act and the provisions of Regulations 17-27 of the SEBI LODR Regulations, which deal with the Corporate Governance Requirements. In terms of the provisions of the SEBI LODR Regulations, a detailed report on Corporate Governance forms part of the Annual Report separately.
10. SUBSIDIARIES AND ASSOCIATE
The Company operates out of 11 other countries, besides India, through 17 Direct and Step-Down Subsidiaries and 1 Associate Company. During the year under review, there was no change in the number of Subsidiaries and Associate Company. The Company did not have any Joint Venture, as at the end of the year under review. There has been no material change in the nature of the business of any of the Subsidiaries and Associate Company.
The details of the markets in which these Subsidiaries and Associate Company operate(s) are included in the 'Management Discussion and Analysis' for the year under review, which forms part of the Annual Report separately.
Further, pursuant to the provisions of Section 129(3) of the Act, a statement containing the salient features of Financial Statements of the Company's Subsidiaries and Associates Company as on March 31, 2024, in Form AOC-1, is included along with the Audited Financial Statements of the Company for the year under review, which forms part of the Annual Report separately. The Annexure also contains details about the performance of Subsidiaries and Associates Company and their contribution to the overall performance of the Company during the period under review.
Pursuant to the provisions of Section 136 of the Act, the Audited Standalone and Consolidated Financial Statements of the Company as on March 31, 2024, along with relevant documents are available on the website of the Company i.e. at https://www.eplglobal.com/investors/financial-and-fillings/. Further, the details about the Subsidiaries and Associate Company are provided in the Annual Return of the Company, with respect to the year under review, in Form MGT-7, which is available on the website of the Company i.e. at https://www.eplglobal.com/investors/corporate-governance/.
The Company has adopted a 'Policy for Determining Material Subsidiaries' of the Company, in terms of the provisions of Regulation 16(1)(c) of the SEBI LODR Regulations. This policy is available on the website of the Company i.e. at https://www.eplglobal.com/ investors/corporate-governance/.
Also, the Company is compliant with the provisions of Regulation 24 of the SEBI LODR Regulations with respect to the Corporate Governance requirements with respect to Subsidiaries of the Company and the minutes of the meetings of the Subsidiary Companies are placed before the Board on a quarterly basis, for bringing the significant transactions and arrangements entered into by the Subsidiary Companies to the attention of the Board.
11. DIRECTORS' RESPONSIBILITY STATEMENT
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the Internal, Statutory & Secretarial Auditors and external consultants, including the audit of internal financial controls over financial reporting by the Statutory Auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company's internal financial controls were adequate and effective during and as at the end of the year under review.
Pursuant to Section 134(5) of the Act, the Directors, to the best of their knowledge and ability, confirm that:
a) in the preparation of the Annual Standalone and Consolidated Financial Statements of the Company for the year under review, the applicable accounting standards have been followed and there are no material departures;
b) such accounting policies, as mentioned in the notes to the Audited Standalone and Consolidated Financial Statements of the Company for the year under review, have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of the year under review and of the profit of the Company for that period;
c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Annual Standalone and Consolidated Financial Statements of the Company have been prepared on a going concern basis;
e) proper internal financial controls are in place at the Company and such internal financial controls are adequate and were operating effectively; and
f) necessary systems have been devised to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
12. DIRECTORS AND KEY MANAGERIAL PERSONNEL Board of Directors
The Board composition, as on March 31,2024, was as under:
During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/ Committee(s) of the Company, if any.
Other details of the Directors on the Board such as,
- the number of other Directorships, Committee Chairmanships/ Memberships held by the Directors in other Indian Public Companies;
- number of shares and convertible instruments of the Company held by the Directors; and
- names of other Equity Listed Companies, where the Directors of the Company hold directorships, along with the category of such Directorships,
are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
Further, details with respect to the meetings of the Board, its committees and remuneration of Directors etc. are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
Change in Directorate
During the year under review, following changes took place in the Board composition:
- Mr. Shashank Sinha (Director Identification Number: 02544431) was appointed as an Additional (Non-Executive, Independent) Director of the Company with effect from September 4, 2023. Thereafter, by virtue of approval of the Shareholders by way of Postal Ballot on November 30, 2023, he was appointed as a Non-Executive, Independent Director of the Company with effect from September 4, 2023.
- Mr. Uwe Rohrhoff (Director Identification Number: 05225437) ceased to be a Non-Executive, Independent Director of the Company with effect from the close of business hours of September 5, 2023. As communicated by Mr. Rohrhoff vide his resignation letter, he resigned as the Non-Executive, Independent Director of the Company due to personal reasons and his pre-occupation outside India, with there being no other material reasons for resignation.
In the opinion of the Board, the Non-Executive, Independent Director appointed during the year possesses requisite integrity, expertise, experience and proficiency, as required in terms of the provisions of the Act and the SEBI LODR Regulations.
Mr. Davinder Singh Brar (Director Identification Number: 00068502) and Ms. Sharmila A. Karve (Director Identification Number: 05018751), both Non-Executive, Independent Directors, would complete their first term of appointment on August 21, 2024. Both the directors have conveyed their consent to continue as Non-Executive, Independent Director of the Company and accordingly, in terms of the provisions of Section 149 of the Act and the SEBI LODR Regulations (each, as amended), the Board has, pursuant to the recommendation of NRC and after considering the evaluation of performance of Mr. Brar and Ms. Karve, approved the proposal for re-appointment of Mr. Brar and Ms. Karve for a second term of 5 years, with effect from August 22, 2024 up to August 21,2029, subject to approval of the Shareholders, at the ensuing AGM. Resolutions for seeking approval of the Shareholders for their respective re-appointment form part of the Notice of the ensuing AGM.
Further, Mr. Dhaval Buch (Director Identification Number: 00106813) who is serving as a Non-Executive, Non-Independent Director of the Company, is due to retire by rotation at the said AGM and being eligible, he has offered himself for re-appointment. The Board has approved the proposal for re-appointment of Mr. Buch, subject to approval of the Shareholders, at the ensuing AGM. A resolution seeking approval of the Shareholders for his re-appointment also forms part of the Notice of the ensuing AGM.
Detailed profiles of Mr. Brar, Ms. Karve and Mr. Buch with information required to be disclosed in terms of the provisions of Regulation 36(3) of the SEBI LODR Regulations and the Secretarial Standards on General Meetings are provided in the Annexure to the Notice of the ensuing AGM.
Declaration from Independent Directors
All Non-Executive, Independent Directors have submitted their respective declarations confirming that they meet the criteria of independence as prescribed under Section 149 of the Act and Regulation 16 of the SEBI LODR Regulations. They have also confirmed that they have enrolled themselves in the Independent Directors' Databank maintained with the Indian Institute of Corporate Affairs (IICA) and they have passed online proficiency test, if required or have been exempted therefrom due to their seniority and experience.
The Company has received the declaration from all the Non-Executive, Independent Directors confirming that in terms of Regulation 25(8) of the SEBI LODR Regulations, they are not aware of any circumstances or situation, which exist(s) or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence. In terms of Regulation 25(9) of the SEBI LODR Regulations, the Board has taken on record such declarations after undertaking due assessment of the veracity of the same.
Based on the declarations received from the Non-Executive, Independent Directors, the Board is of the opinion that the NonExecutive, Independent Directors fulfil the conditions of independence mentioned under Section 149 of the Act and SEBI LODR Regulations and that they are independent of the Management.
Key Managerial Personnel ("KMP")
Details of the KMP, as on March 31,2024, are as under:
During the year under review, following changes took place in the KMP of the Company:
a. Mr. Suresh Savaliya, ceased to be the Company Secretary and Compliance officer of the Company, with effect from April 12, 2023;
b. Mr. Keyur Doshi, was appointed as the Company Secretary and Compliance Officer of the Company with effect from April 13, 2023 and he ceased to be the Company Secretary and Compliance Officer of the Company with effect from August 11,2023;
c. Mr. Amit Jain, ceased to be the Chief Financial Officer of the Company with effect from August 18, 2023;
d. Mr. Deepak Goyal, was appointed as the Chief Financial Officer of the Company with effect from August 19, 2023; and
e. Mr. Onkar Ghangurde was appointed as the Company Secretary and Compliance Officer of the Company with effect from September 4, 2023.
13. MEETINGS OF THE BOARD
During the year under review, the Board met 8 (eight) times i.e. on April 13, 2023, May 19, 2023, August 2, 2023, August 8, 2023, September 4, 2023, November 8, 2023, February 7, 2024 and March 21,2024.
The maximum interval between any 2 (two) meetings did not exceed 120 days. Details of the attendance of the Directors at the Board Meetings are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
14. PERFORMANCE EVALUATION
During the year under review, in terms of the provisions of Section 178(2) of the Act and the SEBI LODR Regulations, the process for evaluation of the performance of the Board, its Committees and Individual Directors (including the Chairman) was undertaken, as per the criteria formulated by the NRC.
For the evaluation of performance of the Board, its Committees and Individual Directors (including the Chairman), the Company had implemented a secured online application, wherein the Directors gave their rating / feedback in a secured manner. The system generated reports and summary were reviewed and discussed by the NRC and the Board, at their respective meetings.
Details of the performance evaluation of the Board, its Committees and Individual Directors (including the Chairman) are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
15. FAMILIARIZATION PROGRAMME
The Company conducts Familiarisation Programmes for Non-Executive, Independent Directors with an aim to provide them with an insight about the Company, its business and nature of the industry in which the Company operates. Further, the Directors are provided with necessary documents, reports and internal policies to enable them to familiarise with the Company's procedures and practices. Presentations are made at the Board Meetings, on performance of each of the Geographical Regions where the Company operates and on practices relating to Human Resources, Business Strategy and Business Plans. Details of the Familiarisation Programmes are available on the website of the Company i.e. at https://www.eplglobal.com/ investors/corporate-governance/.
16. NOMINATION AND REMUNERATION COMMITTEE (NRC)
The NRC has been constituted by the Board, in terms of the provisions of Section 178 of the Act and Regulation 19 of SEBI LODR Regulations. It comprises 3 (three) directors as Members, out of which, 2 (two) Members are Non-Executive, Independent Directors and 1 (one) is a Non-Executive, Non-Independent Director. The Chairman of the NRC is a Non-Executive, Independent Director. Further, all the Members of the NRC are Non-Executive Directors, with 2/3rd of them being Non-Executive, Independent Directors.
During the year under review, the NRC met 4 (four) times and all the recommendations made by the NRC were duly accepted by the Board.
Details of the composition of the NRC along with the details of participation of the Members at its Meetings and the terms of reference of NRC are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
17. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS
In terms of Section 178 of the Act, the Board has adopted the 'Nomination and Remuneration Policy' which inter alia lays down guidelines for matters with respect to appointment and remuneration of Directors (Executive and Non-Executive), Senior Management and Key Managerial Personnel of the Company, including determination of their remuneration and with respect to evaluation of the performance.
The NRC is responsible for dealing with the matters as specified in the Nomination and Remuneration Policy, which includes matters specified under the Act and the SEBI LODR Regulations.
This Policy is divided into three parts and its salient features are as under:
- Part - A of the Policy enlists the matters that shall be considered by the NRC, before recommending the same to the Board.
- Part - B of the Policy lays down the guidelines with respect to appointment and nomination, including following matters:
(a) Appointment criteria and qualifications of Directors, Senior Management and Key Managerial Personnel of the Company;
(b) Term/ Tenure of Managing/ Whole-time Director, Independent Director(s);
(c) Evaluation of Performance of Directors on yearly basis;
(d) Removal of Directors, Senior Management and Key Managerial Personnel of the Company; and
(e) Retirement of Directors, Senior Management and Key Managerial Personnel of the Company.
- Part - C covers matters with respect to remuneration to the Directors (incl. Managing Director/ Whole-time Director), Key Managerial Personnel and Senior Management Personnel, including following matters:
(a) General Matters of process;
(b) Remuneration to Managing Director/ Whole-time Director, Key Managerial Personnel and Senior Management Personnel, including provisions with respect to payment of excess remuneration;
(c) Remuneration to Non-Executive/ Independent Director(s) including limits on the amounts that may be paid by way of commission and sitting fees (for attending the meetings of the Board and of Committees of which they may be Members) etc.
- The Policy specifies that the Independent Director(s) shall not be entitled to Employee Stock Options of the Company.
- The Policy is subject to review, as and when required, but atleast once 3 (three) years.
The above Policy i.e. Nomination and Remuneration Policy, is available on the website of the Company i.e. at https://www. eplglobal.com/ investors/corporate-governance/. The Policy was amended during the year under review to incorporate necessary amendments in the SEBI LODR Regulations.
18. AUDIT COMMITTEE
The Audit Committee has been constituted by the Board, in terms of the provisions of Section 177 of the Act and Regulation 18 of the SEBI LODR Regulations. The Audit Committee comprises 3 (three) directors as Members, out of which, 2 (two) are NonExecutive, Independent Directors and 1 (one) is a Non-Executive, Non-Independent Director. The Chairperson of the Committee is a Non-Executive, Independent Director. All the Members of the Audit Committee possess expertise in accounting and financial management.
The Company Secretary acts as Secretary to the Audit Committee and the meetings are also attended by the other Directors (including the Managing Director), Chief Financial Officer, Chief Operating Officer, representatives of the Statutory Auditors, Internal Auditor, Cost Auditors, Secretarial Auditors and other senior executives, as may be deemed necessary and appropriate by the Committee.
During the year under review, the Audit Committee met 6 (six) times and the maximum interval between any two meetings did not exceed 120 days. All the recommendations made by the Committee were duly accepted by the Board.
Details of the composition of the Audit Committee along with the details of participation of the members at its Meetings and the terms of reference of are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
19. AUDITORS Statutory Auditors
At the 37th Annual General Meeting of the Company held on August 6, 2020, the Shareholders of the Company approved the appointment of M/s. Walker Chandiok & Co LLP, Chartered Accountants (Firm Registration No. 001076N/ N500013), as the Statutory Auditors of the Company, for a term of 5 (five) years i.e. from conclusion of the 37th AGM till conclusion of the AGM to be held in the year 2025.
Secretarial Auditors
During the year under review, in terms of the provisions of Section 204 of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended), M/s. Dilip Bharadiya & Associates, a firm of Practicing Company Secretaries, were appointed as the Secretarial Auditors of the Company to undertake the Secretarial Audit for the Financial Year 2023-24.
Cost Auditors
In terms of the provisions of Section 148 of the Act, read with Companies (Cost Records and Audit) Rules, 2014 (as amended), the Company is required to maintain cost records and consequently, is required to undertake an audit of such cost records maintained. Accordingly, the Board had appointed M/s. Jitendrakumar & Associates, Cost and Management Accountants, as the Cost Auditors for conducting audit of the Cost Accounting Records maintained by the Company for the financial year ending March 31,2024. Further, the Board has, on recommendation of the Audit Committee, appointed them as the Cost Auditors of the Company for conducting audit of the Cost Accounting Records maintained by the Company for Financial Year ending March 31,2025 ("Financial Year 2024-25"). A resolution for seeking ratification of the Shareholders for the remuneration payable to the Cost Auditors for Financial Year 2024-25 forms part of the Notice of the ensuing AGM.
Internal Auditor
During the year under review, Ms. Aparajita Jain, who was appointed as the Internal Auditor of the Company in terms of the provisions of Section 138 of the Act, ceased to be the Internal Auditor of the Company, with effect from the close of business hours of March 13, 2024. Accordingly, at its meeting held on May 28, 2024, the Board has appointed Mr. Navneet Mahansaria, as the Internal Auditor of the Company, with effect from May 28, 2024.
20. AUDITORS' REPORT, SECRETARIAL AUDIT REPORT AND CORPORATE GOVERNANCE CERTIFICATE
The Report of the Statutory Auditors on the Annual Standalone and Consolidated Financial Statements of the Company for the Financial Year 2023-24, is separately provided along with the Audited Financial Statements of the Company, which form part of the Annual Report. There is no qualification, reservation, adverse remark or disclaimer given by the Statutory Auditors in their Report for the year under review. The notes to the financial statements are self-explanatory and do not call for any further comments.
Further, in terms of the provisions of Section 143(12) of the Act, no fraud has been reported by the Statutory Auditors in their report for the year under review.
The Secretarial Audit Report given by the Secretarial Auditor of the Company is annexed as Annexure A to this Report. There is no qualification, reservation, adverse remark or disclaimer given by the Secretarial Auditor in his Report for the year under review.
Further, in terms of the applicable provisions of the SEBI LODR Regulations, the Company has obtained a Certificate from M/s. Dilip Bharadiya and Associates, a firm of Practising Company Secretaries, whereby they have, on basis of their examination, certified that during the year under review, the Company has complied with the conditions of Corporate Governance by the Company as stipulated in the SEBI LODR Regulations. The certificate is annexed as Annexure B to this Report.
21. INTERNAL CONTROL SYSTEM
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. These internal control systems, comprising policies and procedures, cover all financial and operating functions and are designed to provide a reasonable assurance with respect to recording and providing reliable financial and operational information, complying with applicable laws and corporate policies, safeguarding assets from unauthorised use and executing transactions with proper authorisation. The Internal Control System is also supplemented by the Internal Audit, which is conducted by the in-house Internal Auditor, who is assisted by external firms of specialised in the Internal Audit domain. The audit observations and corrective action(s) taken thereon are periodically reviewed by the Audit Committee of the Board.
Further, as a part of the overall Internal Control System, the Company also has an effective Internal Financial Control System, which is designed to ensure the reliability of the financial & other records and for maintaining accountability of persons. During the year under review, as part of the control assurance process, the Internal Financial Controls were reviewed by an independent agency, in line with the guidelines issued by Institute of Chartered Accountants of India (ICAI) on internal financial controls and the Internal Financial Controls were reported to be satisfactory in design and operational effectiveness. More details about the Internal Control Systems (including Internal Financial Controls) are disclosed in the 'Management Discussion and Analysis' for the year under review, which forms part of the Annual Report separately.
22. RISK MANAGEMENT
The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. The Company has framed a robust Risk Management Policy to identify, assess, monitor and mitigate actual or potential risk exposures in order to minimize any adverse impact on the strategic business objectives of the Company, protecting the interest of its stakeholders and meeting the regulatory requirements. The Company has a well laid down mechanism where all business functions follow a common language of risk and work on monitoring risks on a regular basis wherein the nature/ quantum of material risks are assessed along with the adequacy of the mitigation measures.
Further, the Board has constituted the Risk Management Committee ("RMC") in terms of the provisions of Regulation 21 of the SEBI LODR Regulations, for reviewing the risks and mitigation measures on a periodic basis. All aspects of risk such as strategic, regulatory and compliance, operational, financial and reputational risks, whether internal or external, are discussed in the meeting(s) of the RMC. The RMC comprises 8 (eight) Members, out of which, 1 (one) Member is a Non-Executive, Independent Director, 1 (one) is Executive Director, 3 (three) are Non-Executive, Non-Independent Directors and 3 (three) are senior executives of the Company. The Chairman of RMC is a Non-Executive Director. The Company Secretary acts as Secretary to the RMC.
During the year under review, 2 (two) meetings of the RMC were held and all the recommendations made by the RMC were duly accepted by the Board.
Details of the composition of the RMC along with the details of participation of the members at its Meetings and the terms of reference of RMC are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately. Further, more details about the Risk Management mechanism adopted by the Company are disclosed in the 'Management Discussion and Analysis' for the year under review, which forms part of the Annual Report separately.
23. VIGIL MECHANISM
The Company is committed to maintaining high standards of Corporate Governance and Stakeholder responsibility. In line with the same and as per the requirements of the Act and the SEBI LODR Regulations, the Company has adopted a Whistle Blower Policy for establishing a vigil mechanism to deal with instances of unethical behaviour, fraud or mismanagement and to report genuine concerns in that regard, if any. The policy is available on the website of the Company i.e. at https://www.eplglobal.com/investors/ corporate-governance/ .
More details about the Vigil Mechanism/ Whistle Blower Policy are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
24. LOANS, GUARANTEES AND INVESTMENTS
Details of the loans, guarantees and investments covered under applicable provisions of Section 186 of the Act and as per Para A of Schedule V of the SEBI LODR Regulations are given in Note 50 to the Audited Standalone Financial Statements of the Company, for the Financial Year 2023-24.
Further, during the year under review, there were no transactions requiring disclosure or reporting in respect of matters relating to one-time settlement with any bank or financial institution.
25. RELATED PARTY TRANSACTIONS I.E. CONTRACTS AND ARRANGEMENT WITH RELATED PARTIES
In line with the requirements of the Act and the applicable provisions of the SEBI LODR Regulations, the Company has formulated a Policy on dealing with Related Party Transactions ("RPTs"). The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and its related parties.
All transactions with related parties during the year under review were in accordance with the Policy on Related Party Transactions formulated by the Company. Further, all arrangements or transactions entered by the Company during the year under review, with related parties, were at an arm's length basis and in the ordinary course of business. Prior omnibus approval is obtained for RPTs which are of repetitive nature, entered in the ordinary course of business and are at arm's length. A statement on RPTs specifying the details of the transactions, pursuant to each omnibus approval granted, is placed on a quarterly basis for review by the Audit Committee. All related party transactions are placed for approval before the Audit Committee and also before the Board wherever necessary in compliance with the provisions of the Act and the SEBI LODR Regulations.
Further, in terms of the provisions of Section 188(1) of the Act, read with the Companies (Meetings of Board and its Powers) Rules, 2014 (as amended), all contracts/ arrangements/ transactions entered into by the Company with its related parties, during the year under review, were in 'ordinary course of business' of the Company, on 'an arm's length basis' and not 'material; Accordingly, Form No. AOC-2, prescribed under the provisions of Section 134(3)(h) of the Act and Rule 8 of the Companies (Accounts) Rules, 2014 (as amended), for disclosure of details of RPTs, which are 'not at arm's length basis' and also which are 'material and at arm's length basis', is not applicable and hence, the same is not provided as an annexure of this Report.
In terms of the applicable provisions of the SEBI LODR Regulations and Indian Accounting Standards details of the RPTs entered into during the year under review, are given in Note 52 to the Audited Standalone Financial Statements of the Company for the Financial Year 2023-24, which form part of the Annual Report.
The Company's Policy on Related Party Transactions, as approved by the Board, is available on the website of the Company i.e. at https://www.eplglobal.com/investors/corporate-governance/.
26. STAKEHOLDERS' RELATIONSHIP COMMITTEE
The Stakeholders' Relationship Committee ("SRC") has been constituted by the Board, in terms of the provisions of Section 178 of the Act and Regulation 20 of the SEBI LODR Regulations. The SRC comprises 3 (three) Directors as Members, out of which, 1 (one) Member is a Non-Executive, Independent Director and 2 (two) are Non-Executive, Non-Independent Directors. The Chairman of the SRC is a Non-Executive, Non-Independent Director. The Company Secretary acts as Secretary to the SRC.
During the year under review, 1 (one) meeting of the SRC was held on August 8, 2023 and all the recommendations made by the SRC were duly accepted by the Board.
Details of the composition of the SRC along with the details of participation of the members at its Meetings and the terms of reference of SRC are disclosed in the 'Corporate Governance Report' of the Company for the year under review, which forms part of the Annual Report separately.
27. CORPORATE SOCIAL RESPONSIBILITY
The Corporate Social Responsibility ("CSR") initiatives and activities undertaken during the year under review by the Company are aligned with the requirements of Section 135 of the Act. The brief outline of the CSR Policy of the Company, details regarding the CSR Committee and the initiatives undertaken by the Company on CSR activities during the year under review are set out in Annexure C of this Report, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014 (as amended).
Further, it is pertinent to note that the Company's overseas subsidiaries also go the extra mile and take various initiatives on the health, education and other fronts, for helping the society in their respective geographies.
The CSR Policy of the Company is in compliance with the provisions of the Act and the same is available on the website of the Company i.e. at https://www.eplglobal.com/ investors/corporate-governance/.
28. ENVIRONMENTAL, SOCIAL AND GOVERNANCE ("ESG") FRAMEWORK AND BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
The Company considers ESG framework as an integral aspect of its functioning and therefore, it has incorporated sustainability in the dynamics of its business by focusing on the 3Ps of the business viz. Product, Process, and People. The 3Ps of the business are aligned with the global Sustainable Development Goals and United Nations Global Compact (UNGC) principles.
The Company's vision is "to be the most sustainable packaging company in the world" and the Company has made significant strides during the year under review, thereby reinforcing its commitment to this vision. 'Sustainability' is a fundamental principle that guides every aspect of the Company's business and with the increasing global awareness and demand for sustainable practices, the Company has significantly enhanced its capabilities to align with these expectations, culminating in the Company achieving an EcoVadis Gold rating during the year under review.
Other details with respect to the Sustainability at the Company are disclosed in the 'Management Discussion and Analysis' for the year under review, which forms part of the Annual Report separately.
Further, in terms of the provisions of Regulation 34(2)(f) of the SEBI LODR Regulations, the"Business Responsibility and Sustainability Report" of the Company for the year under review, on the ESG disclosures, forms part of the Annual Report separately.
The Company also publishes an Annual Sustainability Report, which is aligned in accordance with the GRI reporting requirements and includes details of the ESG initiatives and sustainability roadmap of the Company and the same is available on the website of the Company i.e. at https://www.eplglobal.com/ investors/sustainability/.
29. ENERGY, TECHNOLOGY & FOREIGN EXCHANGE
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 (as amended) is annexed as Annexure D to this Report.
30. ANNUAL RETURN
In terms of the provisions of Section 92(3) and 134(3)(a) of the Act and rules made thereunder, the Annual Return of the Company for the Financial Year 2023-24, in Form no. MGT 7 is available on the website of the Company i.e. at https://www.eplglobal.com/ investors/corporate-governance/.
31. PARTICULARS OF EMPLOYEES
Details in terms of the provisions of Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended) are annexed as Annexure E to this Report.
The statement containing particulars of employees as required in terms of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended) is annexed as Annexure F to this Report.
32. DEPOSITS FROM PUBLIC
The Company has not accepted any deposits from public and hence, no amount on account of principal or interest on deposits from public was outstanding as on March 31,2024.
33. COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) and that such systems are adequate and operating effectively.
34. AWARDS AND RECOGNITIONS
During the year under review, the Company has received significant recognition for its achievements across various domains highlighting its commitment to sustainability, innovation, and employee well-being. Details about the same are disclosed in the 'Management Discussion and Analysis' for the year under review, which forms part of the Annual Report separately.
35. DISCLOSURES PERTAINING TO THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION. PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance towards any act or behaviour, including sexual harassment, that impacts the dignity of its employees at the workplace. Accordingly, the Company has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace ("POSH Policy") in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act") and the rules made thereunder for prevention and redressal of complaints of sexual harassment at workplace.
In line with the provisions of the POSH Policy, the Company has also set up a separate Internal Committee at all of its administrative units or offices to redress complaints received regarding sexual harassment. Further, the Company has constituted a Central Committee for Governance and Review of POSH.
The Company also conducts interactive sessions for all the employees, to build awareness amongst employees about the POSH Policy and the provisions of POSH Act.
Details of the complaints received during the year under review, under POSH Policy, are as under:
36. ACKNOWLEDGEMENT
The Board places on record its acknowledgement to the customers, suppliers, vendors, banks, financial Institutions and Investors for their continuous support. The Directors also thank the Government of India, Governments of various states in India, Governments of various countries and concerned Government departments and agencies for their co-operation and support.
Finally, the Board acknowledges the valuable contribution made by each and every member of the EPL family and places on record their sincere and heartfelt appreciation to the contributions made by all employees of the Company and their families, whose contributions have been immensely valuable to the growth and profitability of Company's business and have enabled the Company to remain an industry leader.