Market & News

To

The Members,

The Directors are pleased to present their 41^st Annual Report and Audited Financial Statements for the year ended 31^st March, 2023.

FINANCIAL SUMMARY:

(Rs. in 000')

Operations/ State of Company's Affairs:

During the year under review, though the sales value increased marginally to 9,60,138 (Rs. in 000') from 9,41,143 (Rs. in 000') in the previous year, the company earned a net profit of 44,454 (Rs. in

000') as compared to a net loss of 17,616 (Rs. in 000') in the previous year.

The Company overcame numerous challenges it faced in last year on account of covid and the fire incidents and took a lot of strategic steps to improve sales of specialty (high contributory products) and move away from low contributory products.

Necessary steps were taken in order to improve internal efficiencies. Strategic efforts were also made to streamline the supply chain and make it more robust, change the product mix, and target new applications, customers, and markets. All these steps resulted in improved performance and a healthier bottom line in comparison to the previous year.

It was also decided to exit the commodity business for time being and focus on specialty products in the coming year. This decision along with the strategic steps taken in FY 2022-23 will help to make the company to improve its performance in the coming FY 2023-24.

The old office premises at Mumbai was sold and a one-time gain of 21,449 (Rs. in'000) Also added to the bottom line.

No material changes have occurred from the end of the financial year till the date of this report affecting the Company's financial position.

No significant and material orders have been passed by the regulators or Courts or Tribunals impacting the going concern status and the company's operations in the future during the year under review.

There has been no change in the nature of the Business of the Company during the year.

Safety measures against Covid continued as a precautionary step.

DIVIDEND:

The Board of Directors have recommended a dividend of Rs. 1.5 per equity share (15%) for the financial year 2022-23 (previous year Rs. Nil) for the approval at the Annual General Meeting. The Dividend if approved, will result in a cash outflow of Rs. 45 lacs (previous year Rs. Nil)

TRANSFER OF AMOUNTS TO ANY RESERVE:

The Company was not required to transfer any amount to any reserve during the financial year.

BOARD MEETINGS:

The Board of Directors met five times during the Financial Year 2022-23. The dates of the Board meetings have been mentioned in the Corporate Governance Report which forms part of this report.

DIRECTORS AND KEY MANANGERIAL PERSONNEL:

Ms. Charulata Patel (DIN: 00233935), Director of the Company would retire by rotation, at the ensuing Annual General Meeting and being eligible offers herself for re-appointment.

Mr. Vaibhav Kumar Totla, was appointed as Chief Financial Officer of the Company w.e.f. 1st April, 2022.

DECLARATION FROM INDEPENDENT DIRECTORS:

The Company has received necessary declarations from each of the Independent Director of the Company under Section 149(7) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 that they meet the criteria of Independence laid down in Section 149(6) of the Act and SEBI Regulations and there has been no change in the circumstances which may affect their status as independent director during the year. In the opinion of the Board, the independent directors possess appropriate balance of skills, experience and knowledge, as required.

FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS:

In compliance with the requirements of Listing Regulations, the Company has put in place a familiarization program for the Independent Directors to familiarize them with their role, rights and responsibilities as Directors, the working of the Company, nature of the industry in which the Company operates, business model etc. The details of the familiarization programme are explained in the Corporate Governance Report. The same is also available on the website of the company at www.ecoplastindia.com.

AUDIT COMMITTEE:

The Audit Committee of the Board has been constituted in terms of Listing Regulations and Section 177 of the Act. The constitution and other relevant details of the Audit Committee are given in the Corporate Governance Report. All the recommendations made by the Audit Committee were accepted by the Board of Directors

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND CRITERIA FOR INDEPENDENT DIRECTORS:

The Remuneration Policy for directors and senior management and the Criteria for selection of candidates for appointment as directors, independent directors and senior management are placed on the website of the Company at www.ecoplastindia.com

There has been no change in the policies since the last fiscal year.

We affirm that the remuneration paid to the directors is as per the terms laid out in the remuneration policy of the Company.

VIGIL MECHANISM:

The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations. To maintain these standards, the Company encourages its employees who have concerns about suspected misconduct to come forward and express these concerns without fear of punishment or unfair treatment. A Vigil (Whistle Blower) mechanism formulated by the Company provides a channel to the employees and Directors to report to the management concerns about unethical behaviour, actual or suspected fraud or violation of the Codes of conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail of the mechanism and also provide for direct access to the Managing Director/ Chairman of the Audit Committee in exceptional cases. The said Whistle Blower Policy has been disseminated on the Company's website at www.ecoplastindia.com

DIRECTOR'S RESPONSIBILITY STATEMENT:

In pursuance of section 134 (5) of the Companies Act, 2013, the Directors hereby confirm 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 have 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 of the company for that period;

(c) the directors have 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 have prepared the annual accounts on a going concern basis; and

(e) the directors, have laid down internal financial controls to be followed by the company in consultation with the experts and that such internal financial controls are adequate and were operating effectively.

(f) the directors have devised proper systems in consultation with the experts to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS:

The Company has a proper and adequate system of internal financial controls commensurate with its nature and size of business and meets the following objectives:

Providing assurance regarding the effectiveness and efficiency of operations;

Efficient use and safeguarding of resources;

Compliance with policies, procedures and applicable laws and regulations; and

Transactions being accurately recorded and reported timely.

The Company has a budgetary control system to monitor expenditures and operations against budgets on an ongoing basis.

The Internal Auditor also regularly reviews the adequacy of internal financial control system.

SUBSIDIARY COMPANY:

A Statement Containing the Salient features of the Financial Statements of the subsidiary Company is annexed as Annexure- I as a part of this Report.

During the year under review, no Company has become or ceased to be Company's subsidiary, joint venture or associate company.

Further, pursuant to the provisions of Section 136 of the Act, the financial statements of the Company along with relevant documents and separate audited financial statements in respect of the subsidiary are available on the website of the Company at www.ecoplastindia.com.

ANNUAL RETURN:

As per the requirements of Section 92(3) of the Act and Rules framed there under, the Annual Return for the financial year 2022-23 is uploaded on the website of the Company. The same is available on www.ecoplastindia.com

AUDITORS:

As per the provisions of Section 139 of the Act read with the Companies (Audit and Auditors) Rules, 2014, M/s. Y.B. Desai & Associates, Chartered Accountants, Surat, (ICAI Registration No. 102368W) were re-appointed as Statutory Auditors of the Company at the 40^th Annual General Meeting for second term of five years from the conclusion of 40^th Annual General Meeting till the 45^th Annual General Meeting to be held in the year 2027.

PARTICULARS OF FRAUDS, IF ANY REPORTED UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT:

No frauds have been reported by the Auditors under sub-section (12) of Section 143 of the Companies Act, 2013.

SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 and other applicable provisions, if any, of the Companies Act, 2013, Parikh & Associates, Practising Company Secretaries were appointed as the Secretarial Auditors for auditing the secretarial records of the Company for the financial year 2022-23.

Secretarial audit report of the Company as provided by Parikh & Associates, Practising Company Secretaries is annexed to this Report as Annexure- II.

AUDITORS' REPORT AND SECRETARIAL AUDITORS' REPORT:

The Statutory Auditors' Report and Secretarial Auditor's Report do not contain any qualifications, reservations or adverse remarks.

COST AUDITORS:

The provisions of section 148 (2) for appointment of Cost Auditors are not applicable to the Company. The Company has maintained the cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information in accordance with Clause (m) of Sub-section (3) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 is annexed to this Report as Annexure -III.

DEPOSITS:

The Company has not accepted any deposits during the year under report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

As on 31^st March 2023 the Company has made the following Investments under section 186 of the Companies Act, 2013.

Investments; 7,319/- (Rs. in 000') for 11,95,360 Equity Shares of Rs. 10 each fully paid up in Synergy Films Private Limited (Wholly Owned Subsidiary).

RISK MANAGEMENT POLICY:

The Company has adopted a Risk Management Policy which is implemented throughout the Organisation; Special Emphasis on Risk Management is given during the Annual Budgeting Process and Periodical Monthly Meetings.

CORPORATE SOCIAL RESPONSIBILTY POLICY:

To fulfil its CSR Obligations, the Company has spent an amount of 262 (Rs. in 000') for the year as CSR contribution towards the operating expenditure of running the special school Jaina Anupam N Parmar Charitable Trust, which is a not-for-profit organization located at Valsad devoted to work for children/ adult with intellectual and developmental disabilities and running the special school.

This NGO has been running the special school for the mentally challenged children/adult under the name and style of Jalaram Manos Vikas Kendra at Valsad.

Information in accordance with The Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed to this Report as Annexure -IV.

RELATED PARTY TRANSACTIONS:

Particulars of Contracts or Arrangements with Related parties referred to in Section 188(1) in Form AOC- 2 are annexed as Annexure- V to this Report.

FORMAL ANNUAL EVALUATION:

An annual evaluation of the Board's own performance, Board committees and individual directors was carried out pursuant to the provisions of the Act in the following manner:

PARTICULARS OF EMPLOYEES:

Pursuant to Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the particulars of employees are annexed as Annexure -VI to this Report.

DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules made there under. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and has not received any complaint of sexual harassment during the financial year 2022-23.

LISTING WITH STOCK EXCHANGE:

The Company confirms that it has paid the Annual Listing Fees for the year 2023-24 to BSE where the Company's Shares are listed.

INSIDER TRADING REGULATIONS AND CODE OF DISCLOSURE:

The Board of Directors has adopted the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information and Code of Internal Procedures and Conduct for Regulating, Monitoring and Reporting of Trading by Insiders in accordance with the requirements of the SEBI (Prohibition of Insider Trading) Regulation, 2015 and is available on our website www.ecoplastindia.com

CORPORATE GOVERNANCE:

As per Listing Regulations, a separate section on Corporate Governance forms part of this report. A Certificate from Parikh & Associates, Practicing Company Secretary confirming compliance of Corporate Governance forms part of this Report.

Certificate of the CEO & CFO, confirming the correctness of the financial statements, compliance with the Company's Code of Conduct and the Audit Committee in terms of Regulation 17 of the Listing Regulations is attached in the Corporate Governance report and forms part of this report.

MANAGEMENT DISCUSSION ANALYSIS:

In terms of the provisions of Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management's discussion and analysis is set out in this Annual Report.

SECRETARIAL STANDARDS:

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE:

During the financial year no application was made or any proceeding pending against the company under the Insolvency and Bankruptcy Code, 2016.

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF:

Not Applicable during the financial year.

ACKNOWLEDGMENT:

The Directors wish to convey their appreciation to Customers, Suppliers, Bankers, other Stakeholders and specially the employees for their co-operation. The Directors also appreciate the confidence reposed in the Management of the Company by its shareholders.

For and on behalf of the Board of Directors