To The Members,
Your Directors have great pleasure in presenting 34th (Thirty Fourth) Annual Report of the Company together with the Audited Annual Accounts for the year ended 31st March 2024.
PERFORMANCE REVIEW
During the year under review your Company recorded a Revenue from operations of Rs. 8007.66 Lakhs as compared to Rs.8603.33 Lakhs in the previous financial year showing a decrease of 6.92% and the net ProfitZ(loss) after tax stood at Rs. (821.20) Lakhs in the current financial year as against Rs. (240.75) Lakhs in the previous financial year, showing a decrease of 441.10%.
In the challenging market scenario there has been slight dip in the Sales and the Profitability of the Company. The Revenue from operations of the Company constitutes of:
• The Turnover of the gift segment is Rs. 3638.60 lakhs as compared to Rs. 4183.93 lakhs previous year, decreased by 13.03%.
• The Turnover of the Greeting card segment is Rs. 770.68 lakhs as compared to Rs. 885.82 lakhs previous year, down by 13.00%.
• The stationery sale is Rs. 3275.21 lakhs as compared to Rs. 2980.37 lakhs in the previous year, increased by 9.89%.
The Company owned / managed stores have significantly contributed towards Revenue from Operations and the profits.
FINANCIAL HIGHLIGHTS
FOR THE YEAR ENDED
DIVIDEND
In view of the loss, during the year and need to conserve resources for the expansion of the business of your Company, Board expresses its inability to declare any dividend for the financial year 2023-24.
TRANSFER OF UNPAID UNCLAIMED DIVIDEND AND SHARES TO IEPF
During the FY 2023-24, unclaimed dividend for FY 2015-16 was transferred to the Investor Education and Protection Fund (IEPF), pursuant to the provision of Section 124(5) of the Companies Act, 2013 and Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (as amended from time to time).
Pursuant to the provisions of Section 124(6) of the Companies Act, 2013 and the rules mentioned aforesaid, all shares in respect of which dividend has not been paid or claimed for 7 (Seven) consecutive years or more were also transferred in the name of IEPF after requisite notice to concerned Shareholders. Details of such transferred shares are available at the Company's website i.e. www.archiesonline.com under "Investors" section and such shares can be claimed back from IEPF authority after following the prescribed procedure.
RETAIL EXPANSION
The Company continues its efforts to boost sales through different Archies online website/Market Places and Quick Commerce platforms and continued its effort to open retail outlets across India in Malls as well as on high Streets. The Company opened total 04 retail stores and closed total 20 retail stores. As on 31st March 2024 the numbers of company owned/managed stores were 94.
The Company during the year took steps to improve sales and profitability by revamping its E-commerce platform, "archiesonline.com" by making it more user friendly and in line with the existing Indian E-commerce websites to attract more customers. Company has also tied up with various e-retailers who have vast presence in the virtual space like Flipkart, Snapdeal, E-India Store, Groupon India, Saffron Art Pvt. Ltd., Gift A love.com, Phoolwala.com, My flower tree, Shopdues, Indian Gifts Portal, Fern N Petals & Bookaflower.com. The Company has also tie ups with quick commerce now we can get Archies product within 10 Minutes and we are getting great response from these channels.
CORPORATE GOVERNANCE
As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance and Management Discussion and Analysis Report together with a certificate from the Company's Auditors confirming compliance is set out in the annexure forming part of report on Corporate Governance.
In compliance with the Corporate Governance requirements, the Company has implemented a Code of Conduct for all its Board Members and Senior Management Personnel, who have affirmed compliance thereto. The said Code of conduct has been posted on the Company's website.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of the knowledge and belief and according to the information and explanation obtained, your Directors make the following statements in terms of section 134(3) & (5) of the Companies Act, 2013:
(i) That in the preparation of the annual accounts for the year ended 31st March 2024, the applicable Accounting Standards have been followed, along with proper explanation relating to material departures. If any;
(ii) That such accounting policies as mentioned in the Notes to Accounts, have been selected and applied consistently and judgments and estimates have been made that are reasonable and prudent, so as to give a true and fair view to the state of affairs of the company as at 31st March, 2024 and of the profit and loss of the company for the period;
(iii) That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) That the annual accounts have been prepared on a going concern basis;
(v) That the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
(vi) That the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
DIRECTORS
Pursuant to the provisions of section 152 of the Companies Act, 2013, at least two-third of the Directors shall be subject to retirement by rotation out of which, one-third of such Directors must retire from office at each Annual General
Meeting of the shareholders and a retiring directors eligible for re-election. Accordingly, Mr. Jagdish Moolchandani retires by rotation and being eligible, has offered to be re-appointed at the ensuing Annual General Meeting.
The Board met five times during the year under review. Meetings were held on 30th May, 2023, 11th August 2023, 04th October, 2023, 09th November 2023 and 12th February, 2024.
All Independent Directors have given declarations that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the Stock Exchanges.
KEY MANAGERIAL PERSONNEL
The details of the Key Managerial personnel are as under:
* Ms. Neha Singh has resigned from the post of Company Secretary and Compliance Officer w.e.f. 24.06.2024 and appointed Ms. Payal Madaan as a Company Secretary and Compliance officer of the Company w.e.f. 14.08.2024.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board, in consultation with its Nomination & Remuneration Committee has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committee and Individual Directors, including Independent Directors.
A structured questionnaire was prepared after taking into consideration of the various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.
Board members had submitted response on a scale of 1 (outstanding) - 5 (poor) for evaluating the entire Board, respective Committees of which they are members and of their peer Board members, including Chairman of the Board.
The Independent Directors had met separately without the presence of Non-Independent Directors and the members of management and discussed, inter-alia, the performance of Non - Independent Directors and Board as a whole and the performance of the Chairman of the Company after taking into consideration the views of executive and Non-Executive directors.
The Nomination and Remuneration Committee has also carried out evaluation of every Director's performance.
The performance evaluation of all the Independent Directors have been done by the entire Board, excluding the Director being evaluated.
The Board of Directors expressed their satisfaction with the evaluation process.
SUCCESSION PLANNING
The Nomination and Remuneration Committee works with the Board on the Succession plan and prepares for the succession in case of any exigencies.
NUMBER OF MEETINGS OF THE BOARD
The details of the number of meetings of the Board held during the Financial Year 2023-24 forms part of the Corporate Governance Report.
AUDITORS
As per the provisions of the Section 139 of the Companies Act, 2013, Board of Directors, in its meeting held on 13th August, 2022 has recommended the appointment of M/s. Uberoi Sood and Kapoor, Chartered Accountants (FRN-001462N) as the Statutory Auditors of the Company on the recommendation of the Audit Committee and subject to approval of shareholders in the Notice convening the forthcoming AGM of the Company for a term of five consecutive years from the conclusion of 32nd AGM that is scheduled to be held in the year 2022 till the conclusion of 37th AGM to be held in 2027 and the Shareholders of the Company has approved the appointment of Statutory Auditors in the Annual General Meeting held on 23rd September, 2022.
The Company has received consent and eligibility letter from M/s. Uberoi Sood and Kapoor for their appointment, if made, would be within the prescribed limits under Section 139 of the Companies Act, 2013.
AUDITOR'S REPORT
The Notes on financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any observation, qualification, reservation or adverse remark.
COST AUDITORS
As per the new Companies (Cost Records and audit) Rules 2014 the appointment of Cost Auditor is not required for your Company
INTERNAL FINANCIAL CONTROLS
In terms of Section 134 of the Companies Act, 2013 and SEBI ( Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company has an Internal Financial Control System in relation to the policies and procedures adopted by the company . The Company has in place adequate internal financial control with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operations were observed.
RISK MANAGEMENT
Your Company is well aware of risks associated with its business operations. Comprehensively risk management system is being put in place involving classification of risk, adoption of risk management measures and a strong mechanism to deal with potential risks and situation leading to a rise of risks in an effective manner.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS & OUTGO.
The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo information are given in Annexure 'A' to the Directors' Report, in terms of the requirements of Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT-9, as required under Section 92(3) of the Companies Act, 2013 is annexed herewith as Annexure-B and forms an integral part of this report. Weblink for Annual Return is https://archiesinvestors.in/investors/#Annual%20Return.
SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made there under, the Board has appointed M/s. Dayal & Maur, Practicing Company Secretary, to conduct Secretarial Audit for the financial year 2023-24. The Secretarial Audit Report for the financial year ended March 31, 2024 is annexed herewith as Annexure C to this Report and forms an integral part of this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
EMPLOYEES' REMUNERATION
a. None of the Employees drew the salary more than the prescribed limit in a year for the financial year 2023-24 as per the provisions of Section 197 (12) of the Companies Act, 2013 read with Rules 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
b. None of the Employees drew the salary more than the prescribed limit in a month during the financial year 2023-24 as per the provisions of Section 197 (12) of the Companies Act, 2013 read with Rules 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
c. Detail pertaining to Remuneration as required under Section 197 (12) of the Companies Act, 2013 read with Rule 5(1) & 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms a part of this report as Annexure - E.
NOMINATION AND REMUNERATION POLICY
The Board of Directors have constituted Nomination and Remuneration Committee pursuant to Section 178 of the Companies Act, 2013 and regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 comprising Mr. Arun Singhal (Chairperson), Mrs. Sona Mitul Adhia and Mr. Rajinder Kumar Verma as members of the Committee. The Board of Directors has formulated a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The Policy also lays down the criteria for selection and appointment of Board Members. The details of the Policy forms a part of this report as Annexure- D and the Details / Disclosures of Ratio of Remuneration to each Director to the median employee's remuneration as Annexure -E. The Nomination and Remuneration Policy is available on our website at the link- https://archiesinvestors.in/wp- content/uploads/2021/10/nomination-remuneration.pdf.
CORPORATE SOCIAL RESPONSIBILTY
The Board of Directors of the Company have constituted Corporate Social Responsibility (CSR) committee pursuant to Section 135 of Companies Act, 2013, Schedule VII and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and relevant rules and provisions comprising Mr. Sunil Behl (Chairperson), Mr. Anil Moolchandani and Mr. Dilip Seth as members of the Committee on 16th May, 2014. Mr. Dilip Seth and Mr. Sunil Behl has resigned from the Company with effect from 04.08.2020 and 10.11.2020 respectively. Now CSR Committee is consists of Mr. Arun Singhal (Chairperson), Mr. Anil Moolchandani and Mr. Jagdish Moolchandani as members of the Committee. The said Committee has been entrusted with the responsibility of formulating and recommending to the Board, a CSR Policy indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR activities. The Corporate Social Responsibility policy is also available on our website at the link, https://archiesinvestors.in/wp-content/uploads/2021/10/csr.pdf.
Due to loss arised in the average balance of last three years profit, the Company has not spent any amount on CSR Activities in the Financial Year 2023-24. The Annual Report on CSR activities is annexed herewith as Annexure - F.
WHISTLE BLOWER POLICY/ VIGIL MECHANISM
The Board at its meeting held on 16th May 2014, adopted a Whistle Blower Policy/Vigil Mechanism in accordance with the provisions of the Companies Act 2013 and as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, which provides a formal mechanism for all directors, employees and other stakeholders of the Company, to report to the management their genuine concerns or grievances about unethical behavior, actual or suspected fraud and any violation of the Company's Business Code of Conduct.
The Policy also provides a direct access to the Chairperson of the Audit Committee to make protective disclosures to the management about grievances or violation of the Company's Business Code of Conduct.
The Whistle Blower policy is also available on our website at the link, https://archiesinvestors.in/wp- content/uploads/2Q21/10/Whistle-blower-policy-ARCHIES-LIMITED.pdf.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Board of Directors of the Company have constituted Internal Complaint Committee who will hear and redress the complaint made in writing by any aggrieved woman of sexual harassment at workplace as per the "Sexual Harassment of Woman At Workplace (Prevention, Prohibition and Redressal) Act, 2013". The Policy is also available on our website at the link, https://archiesinvestors.in/wp-content/uploads/2021/10/Sexual-Harassment-Policy.pdf.
Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
AUDIT COMMITTEE
The Audit Committee as on 31st March, 2024 comprises Independent Directors namely Mr. Arun Singhal, Mrs. Sona Mitul Adhia and Mr. Rajinder Kumar Verma. All the recommendations made by the Audit Committee were accepted by the Board.
RELATED PARTY TRANSACTIONS
All transactions entered with the Related Parties for the year under review were on arm's length basis and in the ordinary course of business. Thus disclosure in Form AOC-2 is not required. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.
All related party transactions are placed before the Audit Committee as also to the Board for approval. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available on our website at the link, https://archiesinvestors.in/wp-content/uploads/2022/03/Policy-on-Related-Party- Transactions.pdf.
Your Directors draw attention of the members in the notes to the financial statement which sets out related party disclosures.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
Pursuant to the Regulation 34(2) (e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Management Discussion and Analysis Report is annexured to this report.
PUBLIC DEPOSITS
During the year, your Company has not accepted and/or renewed any public deposits in terms of the provisions of the Companies Act, 2013.
PARTICULARS OF LOANS GIVEN, INVESTMENT MADE AND GUARANTEES GIVEN
During the year under review the Company has not granted any loans and Investment made and given guarantee under the provisions of Section 186 of the Companies Act, 2013.
INDUSTRIAL RELATIONS
The relations between the Company and its employees continued to be cordial and harmonious throughout the year under review.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/Courts that would impact the going concern status of the Company and its future operations.
STATUS OF LISTING FEES
Your Company has been regularly paying listing fees to the BSE & NSE, Mumbai where its Equity Shares are listed. ACKNOWLEDGEMENT
Your Directors would like to take this opportunity to express their sincere thanks to its valued franchisees, distributors, C & F agents, collaborators, bankers. Government authorities, customers and all other business associates for their continued co-operation and patronage.
The Directors would also like to express their deep sense of appreciation to all the employees who are committed to strong work ethics, excellence in performance and commendable teamwork and have thrived in a challenging environment. The Directors wish to express their gratitude to the valued shareholders for their unwavering trust and support.