I G Petrochemicals Ltd
Directors Reports
To the Members,
On behalf of the Board of Directors of your Company, it gives me pleasure in presenting
the Thirty Third Annual Report together with the Audited Financial Statements for the year
ended 31st March, 2022:
1. Financial Results
|
|
(Rs in lakhs) |
|
2021-22 |
2020-21 |
| Total revenue |
189,190.74 |
112,835.52 |
| Profit before interest, depreciation and tax |
41,574.53 |
30,333.11 |
| Finance cost |
1,288.10 |
1,455.70 |
| Depreciation and amortization expenses |
4,434.87 |
3,410.37 |
| Profit before tax |
35,851.56 |
25,467.04 |
| Provision for tax |
9,179.67 |
6,453.73 |
| Profit after |
26,671.89 |
18,951.67 |
| Earnings per share (Rs) |
86.60 |
61.54 |
2. Dividend
The Board of Directors has recommended a dividend of 100% i.e. Rs 10/- per equity share
of the face value of Rs 10/- each for the year ended 31st March, 2022 aggregating to Rs
3,079.49 lakhs. In accordance with Regulation 43A of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, ("the Listing Regulations") the
Board of Directors has formulated a Dividend Distribution Policy and the same can be
accessed at www.igpetro.com/ corporate-governance/
3. Operating & Financial Performance
During the year under review, the Phthalic Anhydride market as well as other downstream
products witnessed a strong traction in demand. The Company generated a total revenue of
Rs 1,89,190.74 lakhs as compared to Rs 1,12,835.52 lakhs in the year 2020-21, a sharp
rise of 68% over 2020-21. The Company has recorded the highest ever EBITDA in its history
to Rs 41,574.53 lakhs from Rs 30,333.11 lakhs in 2020-21.
Our prudent management of funds, keeping in mind the turmoil happening in the external
environment, have helped us in reducing the overall finance costs. We continue to
strengthen our balance sheet and are on net zero debt.
The profit after tax stood at Rs 26,671.89 lakhs growing by 41% compared to the
previous year. The tax expenses stood at Rs 9,179.67 lakhs.
The Directors confirm that no material changes or commitments have occurred between the
end of the financial year and the date of this report, which may affect the
financialstatements of the Company.
4. Expansion
During the year under review, the Company successfully commissioned and introduced the
downstream product i.e. Advance Plasticizers with a capacity of 8,400 MTPA.
The Company also initiated further brownfield expansion of Phthalic Anhydride by upto
53,000 MTPA which is expected to commission in CY 2023.
5. Contribution to the Exchequer
The Company has contributed Rs 38,369.86 lakhs to the exchequer by way of income tax,
customs duty, goods and service tax, etc.
6 Share Capital & Finance a) Share Capital
The paid-up Equity Share Capital remained unchanged at Rs 3,079.81 lakhs as at 31st
March, 2022. The shareholdings of the Promoters and Persons Acting in Concert with
Promoters are 68.74%. b) Finance
The borrowings of the Company comprises of external commercial borrowings, term loan
and working capital facilities. The debts (including interest) are being serviced
regularly.
c) Credit Rating
The Credit Ratings of the Company are "INDAA-/Stable" (term loan and fund
based working capital) and "IND A1+" (non-fund based working capital) issued by
India Ratings & Research. d) Deposits
During the year, the Company has not accepted or invited any deposits from the public. e)
Particulars of Loans, Guarantees or
Investments
Details of Loans, Guarantees or Investments covered under the provisions of Section 186
of the Companies Act, 2013 ("the Act") are given in the notes to the financial
statements.
7. Transfer to General Reserves
The Company do not propose to transfer any amount to the General Reserves.
8. Subsidiaries / Associates / Joint Ventures
The Company's wholly owned subsidiary i.e. IGPL International Ltd. is yet to commence
its operations and the present activities relates to investments. The consolidated
financial statements of the Company are prepared in accordance with the applicable
provisions of the Act and the Ind AS. The audited consolidated financial statements
together with the Auditors' report thereon forms part of the Annual Report. In accordance
with the provision of Section 129 of the Act, a statement containing salient features of
the financial statements of the subsidiary in Form AOC-1 is annexed herewith.
The financial statements of the wholly owned subsidiary are placed on the website of
the Company and available for inspection by the members of the Company. A copy of the
audited accounts shall be made available to the member upon request.
9. Corporate Social Responsibility (CSR) Initiatives
The functions of the CSR Committee are guided by the CSR Policy of the Company in
accordance with which the projects are selected and implemented vis-?-vis approval by the
Board of Directors of the Company. The CSR obligation of the Company for the year 2021-22
was Rs 314.96 lakhs excluding an amount of Rs 2.75 lakhs which was to be set-off against
the excess amount spent in 2020-21. During the year, the Company spent Rs 337.00 lakhs.
In respect of the ‘ongoing project' of the previous year i.e. construction of
school by Saraswati Shishu Mandir Trust, the Company had transferred Rs 99.47 lakhs to a
special bank account out of which Rs 50 lakhs has been spent towards utilization for the
said project. An annual report on CSR activities containing prescribed details is annexed
herewith as "Annexure-I".
The CSR Policy of the Company can be accessed at www.igpetro.com/csr/
10. Annual Return
Pursuant to the provisions of Section 92(3) and 134(3)(a) of the Act, the Annual Return
of the Company as at 31st March, 2022 is uploaded on the website of the Company at
www.igpetro. com/corporate-announcement/
11. Vigil Mechanism Policy
The Vigil Mechanism Policy of the Company deals with instances of actual or suspected
unethical behavior, fraud, etc. The Audit Committee reviews the functioning of the Policy.
The details of the Vigil Mechanism has been elaborated in the Corporate Governance Report
and posted on the Company's website www.igpetro.com/corporate-governance/
12. Transfer of shares to IEPF Authority
In accordance with the provisions of Sections 124, 125 of the Act, read with the IEPF
(Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as
"IEPF Rules") the amount of dividend or any other amount remaining unclaimed or
unpaid for a period of seven consecutive years is required to be transferred to the IEPF
Authority. The shares in respect of which dividend remained unclaimed or unpaid for seven
consecutive years or more, shall also be liable for transfer to the demat account of the
IEPF Authority.
The shareholders may note that the dividend declared by the Company for the financial
year 2014-15 and remaining unclaimed shall be transferred to IEPF on 22nd September, 2022.
Further, if the shareholders have not claimed dividend for any of the seven consecutive
years i.e. between FY 2014-15 to FY 2020-21, the underlying shares shall also be
transferred to IEPF. The shareholders are advised to forthwith claim their dividend by
writing to the Company/ RTA.
The Company has uploaded the details of unclaimed dividend on its website at www.igpetro.com/investor-information/
and the same is also available at www.iepf.gov.in/ IEPF/services.html The members whose
shares and dividend have been transferred to the IEPF Authority may claim the same by
making an online application in Form IEPF-5 available at www.iepf.gov.in. The application
for the claiming of shares along with the supporting documents are required to be
submitted in an online mode only, as required under the IEPF Rules.
The Company Secretary of the Company has been designated as the Nodal Officer who can
be contacted for any guidance/assistance to claim the dividend and shares from IEPF
Authority.
13. Board of Directors & Key Managerial
Personnel
Shri J K Saboo retires by rotation and being eligible offered himself for
re-appointment.
The term of Shri Nikunj Dhanuka and Shri J K Saboo expired on 26th April, 2022 and 31st
March, 2022 respectively. Subject to the approval of the members of the Company, the Board
of Directors re-appointed Shri Nikunj Dhanuka and Shri J K Saboo as Managing Director
& CEO and Executive
Director of the Company for a period of three years and two years effective 27th April,
2022 and 1st April, 2022 respectively as per the terms, conditions and remuneration more
particularly set out in the Notice.
All Independent Directors of the Company have furnished declarations under Section
149(7) confirming that they meet the criteria of independence laid down in Section
149(6) of the Act and the SEBI Listing Regulations.
In the opinion of the Board of Directors of the Company, all Independent Directors
possess high integrity, expertise and experience including the proficiency to discharge
their respective duties and responsibilities.
There is no change in the Key Managerial
Personnel of the Company during the financial year 2021-22 and they are Shri Nikunj
Dhanuka, Managing Director & CEO, Shri Pramod
Bhandari, Chief Financial Officer and Shri
Sudhir R Singh, Company Secretary.
None of the Directors have attained the age of seventy five years except Shri M M
Dhanuka who shall attain in the year 2023 and approval of the shareholders is being
sought.
13.1 Meetings of Board and Committees
In accordance with the regulatory requirements, the Board of Directors has
constituted Audit Committee, Nomination and Remuneration Committee, Stakeholders
Relationship Committee, Corporate Social Responsibility Committee and Risk Management
Committee.
The details with respect to the composition, terms of reference, number of meetings
held, etc. of the Board and that of the Committees are disclosed in the Report on
Corporate Governance, which forms part of the Annual Report.
13.2 Board Evaluation
The annual evaluation of the performance of the Board of Directors, Committee of the
Directors individually has been made as more particularly specified in the
Corporate Governance Report.
13.3 Remuneration Policy
The details of the Remuneration Policy forms part of the Corporate Governance Report.
The information relating to remuneration as required pursuant to Section 197 of the Act
read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are given below: a. Ratio of the remuneration of each Director to
the median remuneration of the employees of the Company for the financial year 2021-22
Shri Nikunj Dhanuka, Managing Director & CEO – 64:1 Shri J K Saboo, Executive
Director – 7:1 b. The percentage increase in the remuneration of Managing Director,
Chief Financial Officer and Company Secretary for the financial year Shri Nikunj Dhanuka,
Managing Director & CEO – 30.50% Shri J K Saboo, Executive Director - 19.87% Shri
Pramod Bhandari, Chief
Financial Officer 12%
Shri Sudhir R Singh, Company Secretary – 10% c. The percentage increase in the
median remuneration of employees in the financial year 8.20% d. Number of permanent
employees on the rolls of the Company – 461 e. Average percentile increase made in
the salaries of employees other than the managerial personnel in the last financialyear
was 9.90% whereas the percentile increase in the managerial remuneration was 7.30%.
It is hereby affirmed that the remuneration paid during the year is as per the
Remuneration Policy of the Company.
14. Particulars of Employees
The disclosures pertaining to remuneration and other details under Section 197(12) of
the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are given above. Statement containing the particulars of top ten
employees and the employees drawing remuneration in excess of limits prescribed under
Section 197(12) of the Act read with Rule 5(2) and (3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is given in annexure forming part of
this Report. In terms of the proviso to Section 136(1) of the Act, the Report and Accounts
are being sent to the Members excluding the aforesaid annexure. The said statement is
available for inspection with the Company. Any Member interested in obtaining a copy of
the same may write to the Company at udhuri@igpetro.com.
15. Directors' Responsibility Statement
To the best of our knowledge and belief and according to the information and
explanation obtained by us, in terms of Section 134(3)(c) of the Act, we state: a. that in
the preparation of the annual financial statements for the year ended
31st March 2022, all the applicable accounting standards have been followed and no
material departures have been made from the same; b. that appropriate accounting policies
have been selected and applied consistently and have 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 ended 31st March, 2022 and of the profit of the
Company for that year; c. that proper and sufficient 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/ detecting fraud and other
irregularities; d. that the annual financial statements have been prepared on a going
concern basis; e. that proper internal financial controls were in place and that the
financial controls were adequate and were operating effectively; f. that systems to ensure
compliance with the provisions of all applicable laws were in place and were adequate and
operating effectively.
16. Related Party Transactions
In compliance with the provisions of the SEBI Listing Regulations and the Act, the
transactions with related parties are entered into with the approval of the Audit
Committee and the Board of Directors. The omnibus approval of the Audit Committee are
obtained for transaction which are repetitive in nature.
The Policy on Related Party Transactions can be accessed at
www.igpetro.com/corporate-governance/ All transactions with related parties were on arm's
length basis and in the ordinary course of business and necessary approvals were obtained,
wherever required. There were no material related party transactions. The necessary
disclosures regarding the transactions are given in the notes to the financial statements.
None of the Directors and the KMP has any pecuniary relationships or transactions
vis-?-vis the Company other than those disclosed in the financial statements.
17. Internal Control
The Audit Committee defines the framework care for the audit based on the areas
identified in has been discussion with the Internal Auditors. The Audit Committee lays out
the audit plan at the start of the financial year in consultation with the Internal
Auditor and the management. The Internal Audit function is designed to cover all the major
areas of operations and strives to evaluate the efficacy and adequacy of internal control
systems, adherence to SOPs and manuals, compliance with applicable rules and regulations,
etc. The Internal Auditor participates in all meetings of and reports directly to the
Audit Committee. The internal audit reports dwells on the detailed observations and its
rating, the recommendation and corrective action proposed to be initiated. These are being
followed-up in subsequent audit period. During the period under review no material
observation is reported by the Internal Auditor.
The Company's internal financial control systems commensurate with its nature of
business, size and operations.
18. Risk Management
The Board of Directors has constituted a Risk Management Committee which meets as often
as required. The Committee has defined the risk management framework and manual which
outlines the risk management approach, risk perception and implementation of the risk
mitigation measures. It also identifies and analyzes the risks to the business, risk
assessment and control and implementation of risk management practices in order to ensure
that all activities are conducted in accordance with the defined principles. The Company's
risk management practices aims to limit the business risk through its operations and
finance activities.
The Board of Directors reviews the discussions of the Risk Management Committee.
19. Auditors
19.1 Statutory Auditors
M/s Uday & Co. and M/s SMMP & Associates are the Statutory Auditors of the
Company.
The Members of the Company at the 28th AGM held on 20th September, 2017 had appointed
M/s Uday & Co. as Joint Statutory Auditors of the Company to hold office for a period
of five years from the conclusion of that AGM till the conclusion of the 33rd AGM.
Accordingly
M/s Uday & Co. will hold office upto the conclusion of this AGM.
The Audit Committee and the Board of Directors have recommended to appoint M/s MSKA
& Associates, Chartered Accountants (Firm Registration No. 105047W) (member of BDO
Group) as the Joint Statutory Auditors of the Company to hold office from the conclusion
of the 33rd AGM till the conclusion of the 38th AGM to be held in the year 2027 subject to
the approval of the shareholders. The Statutory Auditors have confirmed their independence
and eligibility for the said appointment. The Auditors' Report does not contain any
qualification, reservation or adverse remark. The Statutory Auditors have not reported any
incident of fraud to the Audit Committee pursuant to Section 143(12) of the Act.
19.2 Cost Auditor
The cost accounts and records are required to be maintained under Section 148(1) of the
Act, which are duly made and maintained. In terms of the provisions of Section 148 of the
Act read with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors
of the Company has, on the recommendation of the Audit Committee, appointed M/s
Krishna S & Associates, Cost Accountants (Firm Registration No. 100939) as the Cost
Auditor to conduct an audit of the cost records of the Company for the year 2022-23.
A resolution seeking members' ratification for the remuneration payable to M/s Krishna
S & Associates is included in the Notice of AGM.
19.3 Secretarial Auditor
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors has appointed
M/s Makarand M Joshi & Associates, Practicing Company Secretaries (Membership No.
5533) as Secretarial Auditor to conduct the Secretarial Audit.
The report of the Secretarial Auditor is given in "Annexure-II". The
Secretarial Audit Report does not contain any qualification, reservation or adverse
remark.
20. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and
Outgo
The information on conservation of energy, technology absorption and foreign exchange
earnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of the
Companies (Accounts) Rules, 2014 is annexed herewith as "Annexure-III".
21. Business Responsibility Report
Pursuant to the Regulation 34 of the SEBI Listing Regulations, Business Responsibility
Report for the year ended 31st March, 2022 is provided separately and annexed to the
Directors' Report as "Annexure-IV".
22. Corporate Governance
During the year under review, the Company has complied with the requirements of
Corporate Governance and a report on the same along with the Auditors' Certificate
confirming compliance is attached with and forms part of this report. A report on
Management Discussion and Analysis for the year under review is presented in a separate
section and forms an integral part of this report.
23. Prevention of Sexual Harassment
The Company is an equal opportunity provider and has zero tolerance in any form or
manner towards the sexual harassment of women at work place. In accordance with the Sexual
Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Act, 2013, the
Company has formulated a policy on prevention, prohibition and redressal of sexual
harassment of women at work place.
The Company has constituted Internal Complaints Committee which meets as and when
required.
No complaints pertaining to sexual harassment of women employees were received during
the year.
24. ISO 9001:2015 and ISO 14001:2015 Certification
Your Company continued to be certified under ISO 9001:2015 for quality management
systems and ISO 14001:2015 for environment management systems by Bureau Veritas.
25. Acknowledgments
Your Directors convey their sincere appreciation to the business partners for their
unstinted support and contribution and thank the customers, members, employees, bankers
and all stakeholders for their co-operation and confidence reposed in the Company.
| For and on behalf of the Board of Directors |
|
|
M M Dhanuka |
|
Chairman |
| Mumbai, 20th May, 2022 |
DIN 00193456 |