To
The Members,
The Board of Directors of Your Company take pleasure in presenting the Sixth Annual Report on the operational and business performance, along with the Audited Financial Statements for the financial year ended March 31, 2024.
KEY FINANCIALS
The Company's Financial Performance for the financial year ended March 31, 2024, is summarized below:
RESULT OF OPERATIONS AND STATE OF AFFAIRS
The total Income of the company for the year under review is Rs. 4086.25 Lakhs as against the previous year Rs. 5035.09 Lakhs. The Profit After Tax stood at Rs. 87.83 Lakhs compared to the previous year Rs. 106.06 Lakhs. Your directors are expecting better results in the coming financial year.
TRANSFER TO RESERVE IN TERMS OF SECTION 134(3) OF THE COMPANIES ACT, 2013
For the financial year ended on March 31, 2024 the Company has transferred the amount of profit to Reserves.
DIVIDEND
Your directors have not recommended any dividend for the year to conserve the resources in the long run.
UNLCAIMED DIVIDEND
There is no balance lying in unpaid equity dividend account.
SUBSIDIARY COMPANY
The Company does not have any subsidiary.
SHARE CAPITAL
(A) Authorized Share Capital
The Company's Authorized Capital stands Rs. 5,00,00,000 (Five Crores only) divided into 50,00,000 Equity Share of Rs. 10/- each. During the Year there has been no change in the authorized share capital.
(B) Issued and Paid-up Share Capital
During the Year under review, the Company has came up with Initial Public Offering and issued 10,84,800 equity shares to the public at Rs. 84/- per share (Face value 10+ Premium 74). As at March 31, 2024, the paid-up equity share capital of the company was Rs. 402,04,860/- (Four Crore Two Lakhs Four Thousand Eight Hundred Sixty) only divided into 40,20,486 (Forty Lacs Twenty Thousand Four Hundred Eighty six) equity shares of Rs.10/- each.
DIRECTORS AND KEY MANAGERIAL PERSONNELS
During the year under review there are following changes in the Board of Directors and Key Managerial Personnel of the Company:
Pinky Kataruka (DIN: 08139054)
In accordance with the provisions of the Companies Act 2013 and SEBI (LODR) Regulations 2015, Ms. Pinky Kataruka was appointed as Non-Executive Independent Director of the Company for the 3 years starting from 05th May 2023 till 04th May 2026 by the Board of Directors which was further approved by the shareholders of the Company in the Extra-Ordinary General Meeting of the Company held on 06th May 2023. She is not liable to retire by rotation.
Abhishek Agrawal (DIN: 08053590)
In accordance with the provisions of the Companies Act 2013 and SEBI (LODR) Regulations 2015, Mr. Abhishek Agrawal was appointed as Non-Executive Independent Director of the Company for the 3 years starting from 05th May 2023 till 04th May 2026 by the Board of Directors which was further approved by the shareholders of the Company in the Extra-Ordinary General Meeting of the Company held on 06th May 2023. he is not liable to retire by rotation.
Sonal Jain (DIN: 10153892)
In accordance with the provisions of the Companies Act 2013 and SEBI (LODR) Regulations 2015, Mr. Sonal Jain was appointed as Non-Executive Independent Director of the Company for the 3 years starting from 09th May 2023 till 08th May 2026 by the Board of Directors which was further approved by the shareholders of the Company in the ExtraOrdinary General Meeting of the Company held on 06th May 2023. She is not liable to retire by rotation.
Yogita Maheshwari
In accordance with the provisions of the Companies Act 2013 and SEBI (LODR) Regulations 2015, Ms. Yogita Maheshwari was appointed as Chief Financial Officer of the Company from 05th May 2023 by the Board of Directors.
COMMITTEES OF THE BOARD:
AUDIT COMMITTEE
The Audit Committee, as per Section 177 of Companies Act, 2013, was constituted on May, 05, 2023 under the Chairmanship of Mr. Abhishek Agrawal. After constitution the committee met Three (4) times with full attendance of all the members. The composition of the Audit Committee as at March 31, 2024 and details of the Members participation at the Meetings of the Committee are as under:
The Committee is governed by a Charter which is in line with the regulatory requirements mandated by the Companies Act, 2013. Some of the important functions performed by the Committee are:
Financial Reporting and Related Processes:
Oversight of the Company's financial reporting process and financial information submitted to the Stock Exchanges, regulatory authorities or the public.
Reviewing with the Management, the Half Yearly Unaudited Financial Statements and the Auditor's Limited Review Report thereon / Audited Annual Financial Statements and Auditors" Report thereon before submission to the Board for approval. This would, inter alia, include reviewing changes in the accounting policies and reasons for the same, major accounting estimates based on exercise of judgement by the Management, significant adjustments made in the Financial Statements and / or recommendation, if any, made by the Statutory Auditors in this regard.
Review the Management Discussion & Analysis of financial and operational performance.
Discuss with the Statutory Auditors its judgement about the quality and appropriateness of the Company's accounting principles with reference to the Accounting Standard Policy.
Review the investments made by the Company.
All the Members on the Audit Committee have the requisite qualification for appointment on the Committee and possess sound knowledge of finance, accounting practices and internal controls.
The Auditors, Internal Auditors, Chief Financial Officer are invited to attend the meetings of the Committee. The Company Secretary acts as the Secretary to the Committee.
Nomination and Remuneration Committee:
The Nomination and Remuneration Committee, as per Section 178(1) of Companies Act, 2013, was constituted on May 05, 2023 under the Chairmanship of Ms. Pinky Kataruka After constitution the committee met twice with full attendance of all the members. The composition of the Nomination and Remuneration Committee as at March 31, 2024 and details of the Members participation at the Meetings of the Committee are as under:
The terms of reference of the Committee as per Companies Act 2013 and SEBI (LODR) 2015, include the
following:
• Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the board of directors a policy relating to, the remuneration of the directors, key managerial personnel and other employees;
• For every appointment of an independent director, the Nomination and Remuneration Committee shall evaluate the balance of skills, knowledge and experience on the Board and on the basis of such evaluation, prepare a description of the role and capabilities required of an independent director. The person recommended to the Board for appointment as an independent director shall have the capabilities identified in such description. For the purpose of identifying suitable candidates, the Committee may:
• Use the services of an external agencies, if required;
• Consider candidates from a wide range of backgrounds, having due regard to diversity; and
• Consider the time commitments of the candidates.
• Formulation of criteria for evaluation of performance of independent directors and the board of directors;
• Devising a policy on diversity of board of directors;
• Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the board of directors their appointment and removal.
• Whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent directors.
• Recommend to the board, all remuneration, in whatever form, payable to senior management.
Stakeholders Relationship Committee:
The Stakeholders Relationship Committee, as per Section 178 (5) of Companies Act, 2013, continued working under Chairmanship of Mr. Pulinattu Nandakumar. The Committee is governed by a Charter, which is in line with the regulatory requirements mandated by the Companies Act, 2013. During the year, the committee met one time with full attendance of all the members. The composition of the Stakeholders Relationship Committee as at March 31, 2024 and details of the Members participation at the Meetings of the Committee are as under:
The terms of reference of the Committee are:
• Resolving the grievances of the security holders of the listed entity including complaints related to transfer/transmission of shares, non-receipt of annual report, non-receipt of declared dividends, issue of new/duplicate certificates, general meetings etc.
• Review of measures taken for effective exercise of voting rights by shareholders.
• Review of adherence to the service standards adopted by the listed entity in respect of various services being rendered by the Registrar & Share T ransfer Agent.
• Review of the various measures and initiatives taken by the listed entity for reducing the quantum of unclaimed dividends and ensuring timely receipt of dividend warrants/annual reports/statutory notices by the shareholders of the company.
During the year, no complaints were received from shareholders. There are no balance complaints. The Company had no share transfers pending as on March 31, 2024.
BOARD'S PERFORMANCE EVALUATION:
The Board of Directors carried out an annual evaluation of the Board itself, its Committees and individual Directors. The entire Board carried out performance evaluation of each Independent Director excluding the Independent Director being evaluated. The Nomination Remuneration Committee also carried out evaluation of every director's performance. The evaluation was done after taking into consideration inputs received from the Directors, setting out parameters of evaluation. Evaluation parameters of the Board and
Committees were mainly based on Disclosure of Information, Key functions of the Board and Committees, Responsibilities of the Board and Committees, etc. Evaluation parameters of Individual Directors including the Chairman of the Board and Independent Directors were based on Knowledge to Perform the Role, Time and Level of Participation, Performance of Duties and Level of Oversight and Professional Conduct etc. Independent Directors in their separate meeting evaluated the performance of Non-Independent Directors, Chairman of the Board and the Board as a whole.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In Compliance with the provision of Section 177(9) the Board of Directors of the Company has framed the "Whistle Blower Policy" as the vigil mechanism for Directors and employees of the Company. The Whistle Blower is disclosed on the website of the Company.
The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerningthe interests of co-employees and the Company.
All Protected Disclosures reported under the Policy are to be thoroughly investigated by the Committee concerned or by a person designated by such committee. As per the requirement of Listing Regulations, details of Vigil Mechanism is provided on the Website of the Company.
STATEMENT ON DECLARATION BY INDEPENDENT DIRECTORS AND STATEMENT ON COMPLIANCE OF CODE OF CONDUCT
Your Company has received declarations from all the Independent Directors confirming that they meetthe criteria of independence as prescribed under the provisions of section 149(6) of the Companies Act, 2013 and there is no change in the circumstances as on the date of this report which may affect their respective status as an independent director:
(a) that necessary declaration with respect to independence has been received from all the Independent Directors of the company;
b) that all the Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Companies Act, 2013.
PUBLIC DEPOSITS
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet or renewed any fixed deposits during the year.
LOANS, GUARANTEES AND INVESTMENTS
The details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 (the Act) are given in the notes to the Financial Statements.
MEETINGS OF THE BOARD
Your Company holds at least four Board meeting in a year, one in each quarter, inter-alia, to review the financial results of the company. The company also holds additional board meeting to address its specific requirements as and when required. All the decisions and urgent matters approved by way of circular resolutions are placed and numbered and noted at the subsequent Board meeting. Annual calendar of the meeting of the board are finalized well before the beginning of the financial year after seeking concurrence of all the Directors.
During the financial year 2023-24, Seven (07) Board Meetings were convened and held. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and the Securities Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015.
The Composition, category and attendance of each Director at the Board and Annual General Meeting and Number of other Directorship and Chairmanship/ Membership of Committee of each Director in various companies is as follows: -
*NED - Non- Executive Director *IDNE- Independent and Non- Executive
Extraordinary General Meeting (EGM):
There were 2 (Two) Extra- Ordinary General Meeting held during the year. PARTICUALRS OF EMPLOYEES:
There was no employee drawing remuneration in excess of limits prescribed under Section 197 (12) of the Companies Act, 2013 read with Rule 5 (2) and 5 (3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules, 2014.
The disclosure pertaining to remuneration as required under Section 197 (12) of the Companies Act, 2013 read with rules 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of Directors report as follows.
Hard copy of statement containing the salient features of all the documents, as prescribed in Section 136 of Companies Act, 2013 or rules made thereunder to those shareholder(s) who have not so registered.
DIRECTORS' RESPONSIBILITY STATEMENT:
You Directors would like to inform that the audited financial statements for the year ended March 31, 2024 are in conformity with the requirements of the Companies Act, 2013 and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company's financial condition and result of operations. These financial statements are audited by M/s. Pravin Chandak & Associates, Chartered Accountants, statutory auditors of the Company.
Pursuant to the provisions of section 134(5) of the Companies Act, 2013, it is hereby confirmed that:
a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.
b. the Directors had 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 at the end of the financial year and of the profit and loss of the Company for that period.
c. the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d. the Directors had prepared the annual accounts on a going concern basis.
e. the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
AUDITORS:
Statutory Auditor
The Board had appointed M/s. Pravin Chandak & Associates, Chartered Accountants as the statutory auditors of the Company for term of five consecutive years, from the conclusion of 5th Annual General Meeting, held in 2023 till the conclusion of the 10th Annual General Meeting to be held in the year 2028, as approved by shareholders of the Company.
COMMENTS ON AUDITOR'S REPORT
The notes referred to in the Auditors report are self-explanatory and as such they do not call for any further explanation.
SECRETARIAL AUDITOR
The Board of Directors at its meeting held on 05th June 2023 have appointed Mr. Hemant Maheshwari (Practicing Company Secretary) having Membership No. 26145 and Certificate of Practice No. 10245 representing H. Maheshwari & Associates, Practicing Company Secretary Firm as Secretarial Auditor of the Company pursuant to Section 204 of the Companies Act 2013, to undertake Secretarial audit of the Company for the Financial Year 2023-24. The Secretarial Audit Report Provided by him is in Annexure II and III.
INTERNAL AUDITORS:
Chandak Agarwal & Co., Chartered Accountants, Mumbai, was Internal Auditors of the Company for FY 2023-24. Internal Auditors are appointed by the Board of Directors of the Company on a yearly basis, based on the recommendation of the Audit Committee.
The Internal Auditor reports their findings on the Internal Audit of the Company, to the Audit Committee on a half yearly basis. The scope of internal audit is approved by the Audit Committee.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were on an
arm's length basis and that the provisions of Section 188 of the Companies Act 2013 are not attracted.
Thus, disclosure in form AOC-2 is not required. Further, there are no materially significant related party transactions made by the Company with Promoters and Directors or other designated persons which may have a potential conflict with the interest of the Company at large.
EXTRACT OF ANNUAL RETURN
In terms of Section 92(3) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company shall be available on the website of the Company https://sarojapharma.com/
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS, COURTS AND TRIBUNALS
No significant and material order has been passed by the regulators, courts, tribunals impacting the goingconcern status and company's operation in future.
MATERIAL CHANGES AND COMMMITMENTS
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement are relates and the date of this report.
CORPORATE GOVERNANCE REPORT
Pursuant to the provisions of Regulation 15(2)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, compliance with the provisions of the Corporate Governance are not applicable to the Company as the Company has listed its specified securities on SME Exchange.
RISK MANAGEMENT POLICY
The Company has laid down procedure to inform the Board about risk assessment & minimization procedure. The risk management approach is based on a clear understanding of the variety of risks that the organization faces, disciplined risk monitoring and measurement and continuous risk management and mitigation measures.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly & efficient conduct of the business, including adherence to the Company's Policies, the preventions and detections of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNING AND OUTGO:
A. CONSERVATION OF ENERGY
The Company is a Trading Company adopts a cautious approach in power and fuel consumption by optimizing the operation of shifts and by following strict fuel consumption measures. However there were no capital investment on energy conservation equipments.
B. TECHNOLOGY ABSORPTION
(i) the efforts made towards technology absorption - None as not immediately required.
(ii) the benefits derived like product improvement, cost reduction, product development or import substitution - Cost Reduction Plan With Shifting Of Garment Employee From Fix Salary To Piece Rate Salary
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) - None imported in previous year than last 3 years.
(a) the details of technology imported - Line System Production Machines In Garment
(b) the year of import - From 2011
(c) whether the technology been fully absorbed; Yes
(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof- Not Applicable
(e) the expenditure incurred on Research and Development - Not significantly
C. FOREIGN EXCHANGE EARNINGS AND OUTGO (RS. IN LAKHS)
The company has done transactions whereby it is required to report foreign exchange earnings as well as outgo which are as follows.
Foreign Exchange Earning: INR 704.88 Lakhs Foreign Exchange Outgo: INR 4.50 Lakhs
MANAGEMENT DISCUSSION AND ANALYSIS:
The Management Discussion and Analysis of the financial condition and result of operation of the Company under review, is annexed as Annexure - I and forms an integral part of the
Directors' Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR):
The Disclosure as per Rule 9 of the Companies (Corporate Social responsibility Policy) Rules, 2014 are notapplicable to the Company.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
During the year the Company has adopted a policy for prevention of Sexual harassment of women at workplace and has not received any compliant of harassment.
ACKNOWLEDGEMENT:
Your Directors would like to express their sincere appreciation for the assistance and cooperation received from the Shareholders, Bankers, regulatory bodies and other business constituents during the year under review.
Your Directors also wish to place on record their deep sense of appreciation for the committed displayed by all executive, officer and staff, resulting in successful performance of the Company.