To
The Members of Alufluoride Limited
Your Directors have pleasure in presenting the Annual Report of your
Company along with the Audited Statement of Accounts for the financial year ended 31st
March 2023. The Report also includes the Management Discussion and Analysis Report and in
accordance with the Guidelines on Corporate Governance.
FINANCIAL RESULTS
The Financial results of the Company for the year under review are as
follows: (Rs. In lakhs)
|
Standalone |
Consolidated |
|
As on 31st March,
2023 |
As on 31st March,
2022 |
As on 31st March,
2023 |
As on 31st March,
2022 |
| Sales and other revenue |
13,740.76 |
8,860.71 |
13,740.76 |
8,860.71 |
| Profit before Finance charges, Depreciation, |
|
|
|
|
| Tax & other adj's |
2,955.32 |
1,428.42 |
2,817.71 |
1,400.42 |
| Less: Finance charges |
288.32 |
269.13 |
290.42 |
270.22 |
| Profit before Depreciation, Tax & other Adj's |
2,667.00 |
1,159.29 |
2,527.28 |
1,130.20 |
| Less: Depreciation |
741.46 |
634.66 |
741.46 |
634.66 |
| Profit before Tax & other adj's |
1,925.54 |
524.63 |
1,785.83 |
495.54 |
| Less: Provision for current tax |
466.37 |
95.44 |
466.37 |
95.44 |
| MAT Credit entitlement |
|
(61.98) |
|
(61.98) |
| Taxes of earlier years |
1.83 |
(37.63) |
1.83 |
(37.63) |
| Deferred Tax Asset/Liability adj's |
68.94 |
147.42 |
68.94 |
147.42 |
| Profit before appropriations and carried to |
|
|
|
|
| Balance Sheet |
1,388.40 |
381.38 |
1,248.69 |
352.29 |
| Add/Less: Other Comprehensive Income |
|
|
|
|
| (Ind-AS adj's) |
26.11 |
14.96 |
26.11 |
14.96 |
| Profit before appropriations and carried to |
|
|
|
|
| Balance Sheet |
1,414.51 |
396.34 |
1,274.80 |
367.25 |
COMPANY'S PERFORMANCE
Your Directors report that during the year under review, the Company
produced 13,801 MT and sold 13,662 MT Aluminium Fluoride, as against 10,380 MT Production
and sold 10,067 MT during 2021-22. Sales and other Revenue are reported at Rs. 13,740.76
lakhs as against Rs. 8,860.71 lakhs during 2021-22. With increased production, better
sales realization, efficient working capital management, increase in other income and
efficient cost control measures, in spite of increased depreciation and finance costs of
the new plant, the Company has posted a record Profit before tax and other adjustments of
Rs.1,925.54 lakhs and a Net profit of Rs. 1,414.51 lakhs after Ind-AS & tax
adjustments as against a Net Profit of Rs. 396.34 lakhs in FY 2021-22 - an increase of
257%.
Your Directors report that as on 31st March, 2023, the
Company had two wholly owned subsidiary companies, namely ALUFLUORIDE INTERNATIONAL PVT.
LTD., UAE and ALUFLUORIDE INTERNATIONAL PTE. LTD., Singapore and these companies incurred
preliminary and other expenses of Rs. 154.00 lakhs (previous year Rs. 29.09 lakhs) for the
period ended 31st March 2023 and accordingly, the consolidated Profit before
appropriations and carried to Balance sheet reported at Rs.1,274.80 lakhs as against
previous year Rs. 367.25 lakhs.
OUTLOOK FOR THE CURRENT YEAR
Your Directors report that the sale price of Aluminium Fluoride for the
current year has improved, even as the costs of production also increased due to the
impact of Ukraine war and unstable market conditions. On a positive note, Hydrofluosilicic
acid (acid) producers are assuring higher than agreed quantities in the current year and
the plant is expected to further improve the production. With the expected adequate raw
material, increased production, increased contracted sale price and better production
efficiencies, your Directors are hopeful for improved results in the current year.
TERM LOAN AND WORKING CAPITAL LIMITS WITH BANKS
Your Directors report that ICICI Bank Limited, Visakhapatnam has
sanctioned a term loan of Rs. 25 crores for Visakhapatnam Aluminium Fluoride expansion
project in FY 2019-2020. It further sanctioned an additional term loan of Rs. 10 crores in
March 2022 and increased fund & non-fund based working capital limits from Rs. 5
crores to Rs. 10 crores. As against these facilities, during the year under review, the
entire sanctioned loan amounts of Rs. 30 crores were withdrawn, utilized Rs. 1.29 crores
out of working capital limits for LC's and BG's and paid an amount of Rs. 6.93 crores
towards principal repayments of term loans in FY 2022-2023. A charge was created, in
favour of the bank, on the assets of the Company to secure the said loan facilities.
FUTURE PROJECTS
The Company signed an MOU on 8th January 2020 at Amman,
Jordan with Jordan Phosphate Mines Company PLC (JPMC) to commission a greenfield Aluminium
Fluoride plant at Eshidiya, Jordan to produce 25,000 TPA. The Company had incorporated a
wholly owned subsidiary Company by name, ALUFLUORIDE INTERNATIONAL PTE. LTD. in Singapore
(AIPL) on 20th September 2021 and the said subsidiary company would be the
joint venture partner for the Jordan project. AIPL along with the JV partners of Jordan
has incorporated a new Company by name JORDANIAN RENEWABLE ALUMINIUM FLUORIDE
MANUFACTURING COMPANY P.S.C., trade name to be known as JORDAN ALUFLUORIDE (JAIF), in
Jordan on 6th November 2022 and this JV will sign various other project
agreements, deeds, permissions, Etc. with JPMC and other statuary agencies for
implementation of the project. The project is expected to commence production during the
second quarter of 2025.
EXPORTS
During the year under review, the Company had not registered any
Exports Sales, as against Export sales of Rs. 0.85 lakhs in FY 2021-22, which was as a
trial run, for the first time, the Company exported the product to Australia.
INSURANCE
All the properties of the Company including Buildings, Plant and
Machinery and Stocks have been adequately insured.
DIVIDEND
Your Directors are pleased to recommend payment of Rs 2 (Rupee Two
Only) per equity share of Rs.10.00 (Rupees Ten only) each i.e., 20% as final dividend for
the financial year 2022-23, for the approval of the Members at the ensuing Annual General
Meeting (AGM) of the Company.
TRANSFER TO RESERVE
The Company has not transferred any amount to the General Reserve for
the financial year 2022-23.
CORPORATE GOVERNANCE
As per Regulation 34 read with chapter IV of the SEBI (Listing
obligations & Disclosure Requirements) Regulations, 2015 a separate section on
Corporate Governance is enclosed which forms part of the Annual Report. A certificate from
the Auditors of the Company on compliance with the conditions of Corporate Governance as
stipulated under the SEBI (Listing obligations & Disclosure Requirements) Regulations,
2015 is annexed to this Report.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed section of the Management Discussion and Analysis for the
period under review as required under SEBI (Listing obligations & Disclosure
Requirements) Regulations, 2015 is given as a separate statement forming part of the
Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 (5) of the Companies Act,
2013 with respect to the Director's Responsibility Statement, it is hereby confirmed: i.
In the preparation of the annual accounts for the financial year ended 31st March
2023, the applicable accounting standards had been followed along with proper explanation
relating to material departures; ii. The Directors had selected such accounting policies
and applied them consistently and made judgments and estimates that were reasonable and
prudent so as to give a true and fair view of the state of affairs of the Company at the
end of the financial year and of the profit of the company for that period; iii. The
Directors had taken proper and sufficient care 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.
The Directors had prepared the accounts for the financial year ended 31st March
2023 on a 'going concern' basis; and v. The Directors had laid down internal financial
controls to be followed by the Company and that such internal financial controls are
adequate and were operating effectively; vi. The Directors had devised proper systems to
ensure compliance with the provisions of all applicable laws and that such systems were
adequate and operating efficiently.
DIRECTORS & KEY MANAGERIAL PERSONNEL (KMP) Directors
During the year under review, there has been no change in the
constitution of the Board of Directors. In accordance with the provisions of the Companies
Act, 2013 and the Articles of Association of the Company, Sri K Purushotham Naidu (DIN:
01883663) retires at the ensuing Annual General Meeting and has conveyed his consent to be
re-appointment as Director of the Company.
During the year under review:
(a) Smt. Jyothsana Akkineni (DIN: 00150047) was re-appointed as
Executive Director of the Company for a period from 6th May 2022 to 30th September
2024; (b) Sri K. Purushotham Naidu (DIN: 01883663) was re-appointed as Executive Director
(Designated as Director Finance & Commercial) of the Company for a period from 6th
May 2022 to 30th September 2024.
The Board of Directors of the Company in its meeting held on 24th
May 2023 has approved re-appointment of Sri Venkat Akkineni (DIN: 00013996) as Managing
Director of the Company, subject to approval of shareholders of the Company.
Particulars in pursuance of Regulation 36 of the SEBI LODR Regulations
read with Secretarial Standard - 2 on General Meetings relating to Sri K. Purushotham
Naidu (DIN: 01883663) and Sri Venkat Akkineni (DIN: 00013996) are given in Notice of AGM.
You Directors recommend the re-appointment of the said Directors.
Key Managerial Personnel
During the year under review, there has been no change in the Key
Managerial Personnel of the Company. Smt. Vaishali Kohli continues to be the Company
Secretary and Compliance Officer of the Company.
The Company has named the Managing Director, Director - Finance &
Commercial as CFO and Company Secretary as its Key Managerial Personnel under the
provisions of Section. 203 of the Companies Act, 2013.
DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
Sri Grandhi Sreeramakrishna, Sri A.V.V.S.S.Ch.B. Sekhar Babu and Sri
Yugandhar Meka are the Independent Directors of the company. The terms and conditions of
appointment of Independent Directors are as per Schedule IV of the Act. They have
submitted a declaration that each of them meets the criteria of independence as provided
in Section 149(6) of the Act and there has been no change in the circumstances which
affects their status as Independent Director during the year.
NUMBER OF MEETINGS OF THE BOARD
Five meetings of the Board were held during the year. For details of
the meetings of the Board, please refer to the corporate governance report, which forms
part of this report.
BOARD EVALUATION
The Board of Directors has carried out an annual evaluation of its own
performance, Board committees and individual Directors pursuant to the provisions of the
Act and the corporate governance requirements as prescribed by Securities and Exchange
Board of India ("SEBI") under SEBI (Listing obligations & Disclosure
Requirements) Regulations, 2015. The performance of the Board was evaluated by the Board
after seeking inputs from all the Directors on the basis of the criteria such as the Board
composition and structure, effectiveness of Board processes, information and functioning,
etc. The performance of the committees was evaluated by the Board after seeking inputs
from the committee members on the basis of the criteria such as the composition of
committees, effectiveness of committee meetings, etc.
>The Board reviewed the performance of the individual Directors on the
basis of the criteria such as the contribution of the individual Director to the Board and
committee meetings like preparedness on the issues to be discussed, meaningful and
constructive contribution and inputs in meetings, etc. In addition, the Chairman was also
evaluated on the key aspects of his role.
In a separate meeting of independent Directors, performance of
non-independent Directors, performance of the Board as a whole and performance of the
Chairman was evaluated, taking into account the views of Executive Directors and
Non-Executive Directors. The same was discussed in the Board meeting that followed the
meeting of the Independent Directors, at which the performance of the Board, its
committees and Individual Directors was also discussed.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS
The Company's policy on Directors' Appointment and Remuneration and
other matters provided in Section 178(3) of the Act has been disclosed in the corporate
governance report, which forms part of the Directors' report.
DISCLOSURE AS REQUIRED UNDER RULE 5 OF COMPANIES (APPOINTMENT &
REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014
The Disclosure as required under Rule 5 of Companies (Appointment &
Remuneration of Managerial Personnel) Rules 2014 is appended in Annexure - A to the Board
Report.
RISK MANAGEMENT
The Board of Directors oversee the various strategic, operational and
financial risks that the organization faces, along with assessment of risks, their
management and mitigation procedures. In the Board's view, there are no material risks,
which may threaten the existence of the Company.
SECRETARIAL STANDARDS
The Directors state that applicable Secretarial Standards, i.e., SS-1
relating to 'Meetings of the Board of Directors' and SS-2, relating to 'General Meetings',
have been duly followed by the Company.
INTERNAL FINANCIAL CONTROLS
The Company has adequate internal financial controls commensurate with
its size and nature of its business. During the financial year under review, Internal
Auditors of the Company have reviewed the effectiveness and efficiency of these systems
and procedures. As per the said assessment, Board is of the view that IFC were adequate
and effective during the financial year.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED
IN SUB -SECTION (1) OF SECTION 188
Details of transactions with related parties falling under the scope of
Section 188(1) of the Act & Information on transactions with related parties pursuant
to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules,
2014 (Form No. AOC-2) is given in Annexure B to the Board Report.
STATUTORY AUDITOR
Pursuant to the provisions of Section 139 of the Act and the Companies
(Audit and Auditors) Rules, 2014 (including any statutory modification(s) or
re-enactment(s) thereof, for the time being in force), Brahmayya & Co., Chartered
Accountants, Visakhapatnam (FRN No: 000513S), were appointed as Statutory Auditors of the
Company in the Annual General Meeting held on 9th July 2023 for a term of 5
(five) years until conclusion of the Annual General Meeting to be held in the year 2027.
SECRETARIALAUDITOR
Pursuant to the provisions of Section 205 of the Act and the rules
framed there under Mr. G.M.V. Dhanunjaya Rao of GMVDR & Associates, Company
Secretaries was appointed as Secretarial Auditor of the Company and the Secretarial Audit
Report issued by them for the financial year 2022-23 is made a part of this Report.
COST AUDIT
The Company is required to maintain cost records for certain products
as specified by the Central Government under sub-section (1) of Section 148 of the Act,
and accordingly such accounts and records are made and maintained in the prescribed
manner.
Further Cost Audit for financial year 2022-23 is not applicable in view
of the Cost Audit Amendment Rules, 2014, Government of India, Ministry of Corporate
Affairs, Notification, New Delhi, dated 31.12.2014.
ANNUAL RETURN
The Annual Return of the Company in prescribed Form MGT-7 is available
on the website of the Company at www.alufluoride.com.
SUBSIDIARIES
As on 31st March 2023, the Company had two subsidiaries as
follows: 1. Alufluoride International Private Limited, UAE. 2. Alufluoride International
Pte. Ltd., Singapore. The Company has applied for voluntary liquidation of the UAE Company
on 9th November 2022 with Jebel Ali Free Zone Authority, UAE (JAFZA) and the official
confirmation from JAFZA is yet to be received. The Company does not have any joint venture
/ associate company(ies) within the meaning of Section 2(6) of Companies Act, 2013.
Pursuant to the first proviso to Section 129(3) of the Act and Rule 5
and Rule 8(1) of the Companies (Accounts) Rules, 2014, the salient features of financial
statements, performance and financial position of subsidiary is given in Form AOC-1 as
Annexure C to this Report.
AUDITORS' REPORT AND SECRETARIAL AUDITORS' REPORT
The Auditors' Report and Secretarial Auditors' Report does not contain
any qualifications, reservations or adverse remarks.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The particulars of loans, guarantees and investments have been
disclosed in the financial statements.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL
POSITION OF THE COMPANY
There are no material changes and commitment affecting the financial
position of the Company.
CORPORATE SOCIAL RESPONSIBILITY
The Company has constituted a Corporate Social Responsibility (CSR)
Committee in terms of Section 135 (1) of the Companies Act, 2013 read with Companies
(Corporate Social Responsibility Policy) Rules, 2014. The committee consists of the
following:
1. Sri A.V.V.S.S.Ch.B. Sekhar Babu Chairman
2. Sri Ashok Vemulapalli Member
3. Smt. Jyothsana Akkineni Member
4. Sri K. Purushotham Naidu Member
Post the financial year end, Mr. Yugandhar Meka was appointed as the
Member of the CSR Committee at the meeting of Board of Directors held on 24th
May, 2023. The CSR activities, projects and programs that are undertaken by the Company
are those which are approved by the committee that is constituted / reconstituted by the
Board of Directors of the Company in this regard (CSR Committee). The CSR Committee
approves the undertaking of such activities, projects and programs as are covered under
the following areas set out in Schedule VII of the Companies Act, 2013. Our company is
committed to ensuring the social wellbeing of the society through its Corporate Social
Responsibility (CSR) initiatives. Our focus is on rural development programs, Swatch
Bharat, promoting education, promoting health care including preventive health care and
sanitation facilities to weaker sections of society through organizing health camps,
meeting operation expenditure of children and poor people. In accordance with the
provisions of Section 135 of the Companies Act, 2013, the Annual Report on CSR Activities
is given in Annexure E to this report.
DEPOSITS
The Company has not accepted any deposits during the year under review.
As such no amount of principal or interest was outstanding on the date of the Balance
Sheet.
UNPAID / UNCLAIMED DIVIDEND
Out of the Interim Dividend amount of Rs. 156.41 lakhs declared by your
directors during the FY 2019-20, an amount of Rs. 8.26 lakhs remained unclaimed/ unpaid as
on 31.03.2023 and out of the Final Dividend amount of Rs. 78.20 lakhs declared by your
directors during the FY 2021-22, an amount of Rs. 3.94 lakhs remained unclaimed / unpaid
as on 31.03.2023.
Further, there is no amount(s) of Dividend which remained unclaimed for
a period of 7 years and hence the requirement of transfer of such amount(s) to Investor
Education & Protection Fund (IEPF) doesn't arise.
INTERNAL CONTROL
The Company has proper and adequate systems unauthorized use or
disposition and the transactions are authorized, regarded and reported correctly. The
internal control is supplemented by an extensive program of internal audits, review by
management and procedures. The internal control is designed to ensure that the financial
and other records are reliable for preparing financial statements and other data, and for
maintaining accountability of assets. The Company's Internal Audit Department is regularly
carrying out the Audit in all areas. Additionally, the Audit committee is reviewing all
Audit Reports with significant control, all issues raised by internal and external
auditing regularly, reports on the business development, all the past and the future plans
are given to the Board of Directors, Internal Auditor's reports are regularly circulated
to all the senior management to comply with the findings.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
Additional information on conservation of energy, technology absorption
and foreign exchange earnings and outgo as required to be disclosed in terms of Section
134(3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is
given in Annexure D and forms part of this report.
POLICY ON PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company always believed in providing an encouraging work
environment devoid of discrimination and harassment including sexual harassment and has
adopted a policy in line with the provisions of Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 and the rules made thereunder. The
objective of the policy is to prohibit, prevent and address issues of sexual harassment at
the workplace. The policy covers all employees irrespective of their nature of employment
and also applicable in respect of all allegations of sexual harassment made by an outsider
against an employee. An Internal Complaints Committee (ICC) has also been set up to
redress complaints received on sexual harassment. No complaint was pending at beginning of
the year and none has been received during the year.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Pursuant to the provisions of Section 177(9) of the Act, the Board of
Directors of the Company has framed the Vigil Mechanism / Whistle Blower Policy for
Directors and Employees of the Company. Under the said Policy, provisions have been made
to safeguard persons who use this mechanism from victimization.
The Policy also provides access to the Chairperson of the Audit
Committee under certain circumstances. The Whistle Blower Policy is uploaded on the
website of the Company at www.alufluoride.com.
EMPLOYEE RELATIONS
During the year under review, the company has enjoyed cordial
relationship with all section of employees. The company believes that the employees play a
vital role in increasing the turnover and profitability of the company and the strength of
the company lie in harnessing the manpower in achieving sustained long-term growth in all
spheres. The Company had formed rigorous safety procedures and regulations to minimize
COVID-19 infections and to mitigate adverse consequences for those infected. Any staff
infected where mentored and counselled by one of his/her senior to assure proper, timely
and adequate steps were taken to resolve the ill-health expeditiously. All employees were
covered for insurance by the Company for COVID 19 and free timely vaccinations were
facilitated.
ENVIRONMENT & SAFETY MEASURES
Following the ISO Certifications of 9001, 14001 and OHSAS 45001 the
Company will continue taking all the necessary measures to maintain high standards of
Environment, Clean and Green Belt, Water Harvesting, Pollution Control, Health and Safety
Precautions.
DISCLOSURES UNDER THE ACT
Change in Nature of Business, if any:
During the financial year 2022-23, there was no change in the nature of
business of the Company.
Significant and Material Orders:
The Company has not received any significant or material orders passed
by any regulatory authority, court or tribunal which shall impact the going concern status
and Company's operations in future.
Reporting of Frauds by Auditors:
During the year under review, there were no frauds reported by Auditors
under Section 143(12) of the Act.
Details on Insolvency and Bankruptcy Code:
During the year under review, no application has been made by the
Company nor is any proceeding pending against the Company under the Insolvency and
Bankruptcy Code.
Disclosure with respect to Valuation:
During the year under review there was no instance of onetime
settlement with any Bank or Financial Institution. Accordingly, disclosure relating to the
details of difference between amount of the valuation done at the time of onetime
settlement and the valuation done while taking loan from the Banks or Financial
Institutions along with the reasons thereof, is not applicable to the Company.
ACKNOWLEDGEMENT
Your Directors take this opportunity in expressing their gratitude to
the Government of India and the State Government. The Board is also thankful to all its
Bankers, Contractors, Customers and Shareholders for their unstinted support to the
Company.
|
For and on behalf of the Board |
|
For ALUFLUORIDE LIMITED |
|
SREERAMAKRISHNA GRANDHI |
|
Chairman |
|
DIN: 06921031 |
|
VENKAT AKKINENI |
|
Managing Director |
|
DIN: 00013996 |
| Hyderabad |
|
| 24th May 2023 |
|
