P I Industries Ltd
Directors Reports
Dear Members,
Your Directors are pleased to present the 76th Annual Report on the
business and operations of the Company (PI) together with the Audited Financial Statements
for the financial year ended March 31, 2023.
1. FINANCIAL HIGHLIGHTS (STANDALONE) (in ' million)
Particulars |
FY
2022-23 |
FY
2021-22 |
Revenue
from Operations |
62,704 |
50,769 |
Other
Income |
1,589 |
999 |
Profit
Before Interest, Depreciation and Tax |
16,789 |
12,112 |
Interest |
355 |
123 |
Depreciation |
2,217 |
1,984 |
Profit
before Tax & Exceptional items |
14,217 |
10,005 |
Less:
Current Tax |
(2,567) |
(1,852) |
Deferred
Tax |
(464) |
(44) |
Profit
after Tax |
12,114 |
8,197 |
Add:
Other Comprehensive Income |
(396) |
87 |
Total
Comprehensive Income |
11,718 |
8,284 |
Balance
of retained earning brought forward from previous year |
36,008 |
28,563 |
- Profit
for the year |
12,114 |
8,197 |
- Other
Comprehensive Income (OCI) for the year |
(396) |
87 |
Appropriations:
- |
- |
- |
Final
Dividend on Equity Shares 2021-22 |
455 |
- |
2020-21 |
|
303 |
Interim
Dividend on Equity Shares 2022-23 |
683 |
|
2021-22 |
|
455 |
Dividend
Distribution Tax on Equity Shares |
- |
- |
Transfer
to General Reserve |
- |
- |
Balance
Profit carried forward |
46,035 |
36,008 |
Earnings
Per Share - Basic (in ') |
79.84 |
54.03 |
- Diluted
(in ') |
79.84 |
54.03 |
2. KEY HIGHLIGHTS
The Company's Revenue from Operations for the year ended March 31,
2023, on a standalone basis stood at '62,704 Million as compared to '50,769 Million in the
previous year registering a growth of 23.5% on YoY basis. The Operating Profit for the
year was at '15,200 Million as compared to '11,113 Million in the previous year i.e., an
increase of 36.78% YoY. The Net Profit for the year on standalone basis stood at '12,114
Million as compared to '8,197 Million in the previous year i.e., a growth of 47.79% YoY.
The Company's Revenue from Operations for the year ended as on March
31, 2023, on consolidated basis stood at '64,920 Million
as compared to '52,995 Million in the previous year, registering a
growth of 22.50% on YoY basis. The Company's Net Profit for the year
ended March 31, 2023, on consolidated basis stood at '12,295 Million during the year as
compared to '8,438 Million in the previous year, a growth of 45.71% YoY.
Inspired by Science
The Earnings Per Share (EPS) for the year stood at '81.06 per share,
shows a growth of 45.66% as compared to '55.65 per share for the previous year.
The Company invested '425 Million in fixed assets for the expansion of
manufacturing and Research & Development capacities.
No amount was transferred to general reserves during the year.
3. PRESENTATION OF STANDALONE AND CONSOLIDATED FINANCIAL STATEMENTS
The financial statements of the Company for FY 2022-23, on a standalone
and consolidated basis, have been prepared in compliance with the Companies Act, 2013 (the
'Act') applicable Accounting Standards and the Listing Regulations and amendments thereto
and are disclosed in accordance with Schedule III of the Act. The consolidated financial
statements incorporate the audited financial statements of the subsidiaries and joint
ventures of the Company.
4. BUSINESS PERFORMANCE
During the year under review, the Company launched seven new products,
namely Distruptor, Brofreya, Dinoace, Taurus (Insecticide), Tomatough (Biostimulant),
Provide (Herbicide) & Sectin (Fungicide).
• Distruptor is an innovative technology which protects the Rice
crop from devastating pests like BPH (Brown Plant Hopper) & WBPH (White Backed Plant
Hopper). Powered with XP technology it works on all stages of BPH. Distruptor launch in
rice markets across the country has placed us well in the dynamic BPH segment.
• Dinoace is a dual action insecticide recommended for sucking
pests' control on Cotton crop. It is powered by DSA technology which gives quick knockdown
action & a long duration control.
• Brofreya is a revolutionary insecticide which is bringing
technological advancement for Indian farmers. It gives cross spectrum control on
Lepidopteran & sucking pests. It is a safer chemistry with only 1 day PHI (Pre-Harvest
Interval).
• Taurus is first addition of a nematicide in PI's portfolio. It
helps in management of nematodes in Tomato crop.
• Tomatough is a seaweed-based product which, with its superior
technology, helps in boosting plant health & endogenous immunity in crops.
• Sectin is a combination fungicide with excellent curative
control against Downy mildew & late blight.
• Provide is a herbicide with pre-emergence to post-emergence
application on Cotton crop. With advanced MEC formulation & dual mode of action, it
gives broad-spectrum control. The addition of Provide has strengthened PI's Cotton Crop
Solution (CCS) portfolio.
Normal monsoon season during the crop sowing period of Kharif supported
timely sowing of crops and normal acreages in each crop segment. Continuous rain in
June-July resulted in the growth of herbicides. Newly introduced cotton herbicide Provide
was received well in the market. Likewise, Elite on Corn crop also performed well for the
business.
Tremendous efforts were made by the organization to support ongoing
transition from a product approach to a crop solution approach. Different initiatives were
taken for it- Dhan Dhaan Kisaan for rice crop, CCS plots for cotton crop, and chilli micro
battle for chilli crop (Horticulture business). These initiatives have kept all
stakeholders focused on the goal.
The Company's exports grew 26% during FY23 as compared to the previous
year due to scale up of existing products and introduction of 4 new products.
The Company successfully commercialized 4 new molecules during the
year, which also included 2 new Electronic Chemicals, marking the Company's foray into
this niche specialized field offering promising potential in the future. Continuing on its
thrust in investing for the future and ramping up its capabilities, the Company has
operationalized "Flow-Chemistry" at the commercial plant level, successfully
commissioned a manufacturing facility for MMH and established Azide chemistry at a
commercial scale.
The Company continues to explore and adopt new innovations in
chemistry, process and engineering technologies, and is working with innovator partners to
introduce novel molecules globally and continue to expand its customer base.
Various new technology absorption measures were also undertaken at
plants in line with Industry 4.0 best practices. The Company implemented electronic
notebooks as an analytical tool with an aim to digitalize the process development data and
use the tool to fetch information from archive and other data analytics. The Company
continues to work towards sustainable manufacturing, increasing the share of renewable
energy in total energy sourcing and has further undertaken concrete measures for reduction
of carbon footprint and water consumption. The Company has increased thrust on use of
renewable energy usage and its share of the same in FY 23 has been 5.1% of total
requirements. This is achieved by the implementation of energy sourcing through solar and
hybrid power at all manufacturing locations.
In the past year, the Company has made significant progress in our
digital initiatives, including application modernization, analytics, adoption of cloud
technology, and strengthening our information security posture. One of the major
achievements has been the successful modernization of the legacy applications, which has
improved its performance and made it more user-friendly. The Company has also invested
heavily in analytics, which has enabled it to gain deeper insights into business
operations and make data-driven decisions. Furthermore, its adoption of cloud technology
has enabled it to be more agile and responsive to changing business needs. It has migrated
key applications and workloads to cloud, which has improved its scalability, reliability
and reduced costs. Additionally, it has made significant investment in the information
security posture, ensuring that the systems are protected against cyber threats and data
breaches. It has implemented several security measures, such as multi-factor
authentication, mobile device management, data leak prevention, 24 X 7 Security Operations
Center (SOC), and regular vulnerability assessments, to keep its systems and data safe.
Overall, the digital initiatives have helped to enhance the operational efficiency, drive
innovation, and improve the overall competitiveness in the marketplace.
In a year marked with geo-political uncertainties, the Company has
further reduced dependency on single sources, in line with its commitment to de-risk the
supply chain and ensure supply sustainability.
5. AWARDS AND RECOGNITIONS
The Research & Manufacturing facility of the Company at Udaipur
bagged the Karkhana Suraksha Puraskar 2023 (Factory Safety Award 2023) under the category
of Large-Scale Industries. The award was presented by the Factories and Boiler Inspection
Department, Rajasthan, in association with National Safety Council - Rajasthan State
Chapter on the occasion of the 52nd National Safety Day, March 04, 2023.
The Company has been declared the winner of the esteemed Golden Peacock
Award for Corporate Social Responsibility for the year 2022 by the Awards Jury under the
Chairpersonship of Hon'ble Justice M. N. Venkatachaliah, former Chief Justice of India and
former
Chairperson, National Human Rights Commission of India, and National
Commission for Constitution of India Reforms.
The Company retained Ecovadis Gold medal in sustainability achievement
in 2022, with 97 percentile ranking.
The Company has been awarded the prestigious Golden Peacock National
Quality Award for the year 2022. The list was declared by the Awards Jury under the
Chairpersonship of Hon'ble Justice M.N. Venkatachaliah, former Chief Justice of India and
former Chairperson, National Human Rights Commission of India and National Commission for
Constitution of India Reforms after scrutiny of over 265 applications.
The Company has been featured amongst India's Top 500 companies 2022 in
the list of ESG-driven enterprises released by Dun & Bradstreet on July 14, 2022, and
was also conferred the Corporate Award 2022 for Outstanding Performance.
The Company has been featured amongst the biggest players in India's
$212 billion Chemical Industry that is fuelling the chemical boom in India in Fortune
India magazine, July 2022 issue.
Mr. Mayank Singhal, Vice Chairperson and Managing Director of the
Company, was honoured as India's BEST CEO in the Agriculture & Allied sector at the
10th edition of the Business Today (BT-Mindrush) event held on June 24, 2022. The award
was presented to him by the Hon'ble Minister Shri Piyush Goyal (Minister of Commerce &
Industry, Consumer Affairs, Food & Public Distribution, and Textiles, Govt. of India),
in the august presence of Mr. Narayana Murthy (Infosys), Shri R C Bhargava (Maruti Suzuki
India), T. V. Narendran (Tata Steel), S. N. Subrahmanyan (Larsen & Toubro) and several
other industry leaders.
The Company's manufacturing site at Jambusar (Gujarat) has been
successfully awarded ISO 9001:2015 certification. This prestigious certification is a
testimony to the Company's quality commitment.
Mr. Mayank Singhal has also been chosen to lead CII Northern Region's
(CII-NR) Committee on Agriculture, Food Processing and Dairy as its Chairperson for
2022-23. This special recognition comes from his outstanding contribution and commitment
to CII-NR which works to create and sustain an environment conducive to the development of
India, partnering with industry, government, and civil society through advisory and
consultative processes.
Mr. Mayank Singhal has also been recognized as Asia's Promising
Business Leader by the Economic Times (ET), a widely read business- focused daily
newspaper from The Times Group during The Economic Times Asian Business Leaders Conclave
2021-22.
6. RESEARCH & DEVELOPMENT (R&D)
During the financial year FY 23, various departments of R&D have
integrated into a new "PI Research & Development", to make a broader use of
resources, capabilities and to realize synergies.
The process R&D team was actively engaged in more than 50 projects
in the areas of agrochemistry, electronic chemicals, and life cycle management. Literature
search, feasibility analysis and lab studies were carried out for 36 projects that are
targeting external customers. For 10 of these projects, representative samples have been
prepared and submitted to various customers for evaluation and validation. Process
demonstration has been completed on kilolab and pilotplant scale for 13 projects, and 6
projects are presently in various stages of commercialization.
For one of the aforesaid projects, an innovative process based on
flow-chemistry was successfully implemented on a commercial scale, thereby significantly
improving the process efficiency for large scale manufacturing. This approach will result
in a reduced ESG-related footprint, exemplifying opportunities to adopt this technology
for further projects.
To extend the backward integration into key intermediates for new and
ongoing projects, R&D activities on the area of gas phase fluorination have been
initiated.
A new biotechnology laboratory has been built to develop enzymes as
biocatalysts for chemical transformations, targeting the development of greener and safer
processes from an environmental point of view, and extending the technology platform of PI
as a whole.
The product innovation team is running a state-of-the-art integrated
R&D set-up for crop protection, with chemical discovery, laboratory, and greenhouse
facilities for biological testing and with farm resources for first field trials. This
facility supports various R&D projects, with a focus on plant diseases, animal pests
and weed control. Scientifically, it involves chemical synthesis from discovery to
scale-up, analytics for structural elucidation, quantitation as well as preparative
purification and separation, molecular design and modelling, classical biological
evaluation (in vitro lab, in vivo lab, greenhouse, and field testing) supported by
biochemical and molecular biology research, and by formulation development. All these
activities are connected by an integrated high-end electronic data documentation and
management system.
A knowledge management function, responsible for literature and patent
search, competitor and customer intelligence, patent filing and prosecution, and
intellectual property management, is complementing the science and technology-related
activities across entire R&D, offering its services to various PI business groups and
to corporate functions.
The Company's R&D strategy and its implementation are well
supported by a strong team of more than 450 research scientists with international
experience, having state-of-the-art expertise in chemistry, analytical techniques,
biological and biochemical testing, mode of action studies, tox and e-tox studies, IP
management and basic and detailed process engineering including process safety.
The research assignments are involving global partners including CROs
offering expertise in special areas of chemistry, engineering, IT, special analytical,
biology, global field trials, and regulatory disciplines. This is complemented by a
growing network of contacts to academia within India and on an international scale.
With respect to its customer research and manufacturing business, the
Company continues to pursue cost leadership in which the R&D team is playing a vital
role by focusing on process innovations and cost improvement opportunities for the
existing product portfolio, to identify cost improvement opportunities and at the same
time maintaining the highest standards of Quality, Health, Safety and Environment (QHSE).
The Company's R&D and manufacturing teams are constantly working together following
the ESG paradigm, e.g., with respect to green chemistry, waste reduction, energy savings,
minimizing the carbon footprint, reducing the environmental load, and enhancing safety of
processes and products.
7. FINANCE
The Company continued to focus on managing cash efficiently and ensured
that it has adequate liquidity and back up lines of credit. Net cash from operations for
the year stood at '15,021 Million. The Company follows a prudent financial policy and aims
at maintaining an optimum financial gearing. The Company's debt to equity ratio was Nil as
on March 31, 2023.
In the financial year 2022-23, CRISIL carried out the review of credit
rating of loans and based upon its assessment, reaffirmed the credit rating for long term
loans at AA+/Stable whereas for short term loans, rating was reaffirmed at A1+. This
reflects a very high degree of safety regarding timely servicing of financial obligations
and a vote of confidence reposed in the Company's financials.
8. DIVIDEND
During the year, the Board of Directors of the Company declared an
interim dividend of ' 4.5/- per equity share in its Board meeting held on February 14,
2023, on 15,17,18,118 equity shares of face value of ' 1/- each which was paid on March
06, 2023.
The Board of Directors at its meeting held on May 18, 2023 has
recommended a final dividend of '5.5/- per equity share of face value of '1/- each, which
if approved at the forthcoming Annual General Meeting (AGM), will be paid to all those
equity shareholders of the Company whose names appear in the Register of Members and whose
names appear as beneficial owners as per the beneficiary list furnished for the purpose by
National Securities Depository Limited and Central Depository Services (India) Limited as
on record date i.e., August 11, 2023, fixed for this purpose. The total dividend for the
year would be '10/- per equity share of face value of ' 1/- each.
The dividend recommended is in accordance with the principles and
criteria set out in the dividend distribution policy of the Company. The dividend, if
declared at the ensuing AGM will be taxable in the hands of the members of the Company
pursuant to Income Tax Act, 1961. For further details on taxability, please refer AGM
Notice.
DIVIDEND DISTRIBUTION POLICY
PI believes in maintaining a fair balance between cash retention and
dividend distribution. Cash retention is required to finance acquisitions and future
growth and as a means to meet any unforeseen contingencies.
Pursuant to Regulation 43A of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 ("Listing Regulations") the Company
has formulated its Dividend Distribution Policy which specifies the financial parameters,
internal and external factors that are to be considered by the Board while declaring a
dividend. Dividend Distribution Policy is uploaded on the Company's website i.e.
https://www.piindustries.com/Media/Documents/Dividend%20
Policy%20(f).pdf
9. SUBSIDIARIES & JOINT VENTURES
As on March 31, 2023, the Company had seven (7) wholly owned
subsidiaries and two (2) joint ventures with leading Japanese companies. In accordance
with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated
financial statements consisting financials of all its subsidiaries and joint ventures. The
key highlights of these subsidiaries and joint venture companies are as under:
SUBSIDIARY COMPANIES
i. Jivagro Limited
The Company owns 100% stake in Jivagro Limited. It is engaged in
horticulture business. The total revenue of Jivagro Limited stood at '2,863 Million with
net profit of '174 Million posted during the year ended March 31, 2023.
ii. PI Health Sciences Limited
The Company owns 100% stake in PI Health Sciences Limited. It is
engaged in the pharmaceutical business. In order to enable its plans of growth and
expansion in the pharmaceutical sector, PI Health Sciences Limited has incorporated a
wholly-owned subsidiary in Netherlands i.e., PI Health Sciences Netherlands B.V on April
07, 2023 and also acquired 100% shareholding in two companies i.e., Therachem Research
Medilab (India) Private Limited and Solis Pharmachem Private Limited on June 02, 2023.
Further, PI Health Sciences Netherlands B.V has incorporated a wholly-owned subsidiary in
United States i.e., PI Health Sciences USA LLC on April 24, 2023 and acquired 100%
shareholding of Archimica S.p.A. on April 27, 2023.
iii. PI Life Science Research Limited
The Company owns 100% stake in PI Life Science Research Limited, which
carries on the business of R&D for developing new products. The Company posted a
profit of '39.87 Million during the year ended March 31, 2023, on account of various
R&D activities for developing new products.
iv. PI Japan Co. Limited
The Company owns 100% stake in PI Japan Co. Limited, incorporated in
Japan, which takes care of business development activities of the Company in Japan. The
Company posted a net profit of JPY 3.42 Million during the year ended March 31, 2023. Due
to the size of operations and local laws, the annual accounts of this Company are not
required to be audited. The same have been certified by the management of the Company for
the purpose of consolidation.
v. PILL Finance and Investments Limited
The Company owns 100% stake in PILL Finance and Investments Limited.
The Company posted a profit of '0.41 Million during the year ended March 31, 2023.
vi. PI Bioferma Private Limited
The Company owns 100% stake in PI Bioferma Private Limited. The Company
is yet to start the business operations.
vii. PI Fermachem Private Limited
The Company owns 100% stake in PI Fermachem Private Limited. The
Company is yet to start the business operations.
In terms of Regulation 16(1)(c) of the SEBI (LODR) Regulations, 2015,
the Company does not have any material subsidiary as on March 31, 2023.
JOINT VENTURES
i. Solinnos Agro Sciences Private Limited
Solinnos Agro Sciences Private Limited ('Solinnos') is carrying out
registration activities for different products of Mitsui Chemicals Agro Inc., Japan,
('MCAG') in India. The Company holds 49% stake in Solinnos through its subsidiary namely
PI Life Science Research Limited, whereas remaining 51% stake is held by MCAG, Japan.
Solinnos posted a net profit of '31.24 Million during the year ended March 31, 2023.
ii. PI Kumai Private Limited
PI Kumiai Private Limited ('PI Kumiai') is mainly engaged in the
manufacturing and trading of agrochemicals in collaboration with Kumiai Chemical Industry
Co. Ltd, Japan, owning 50% stake in this joint venture. The Company holds remaining 50%
equity in PI Kumai through its subsidiary namely PI Life Science Research Ltd. The
aforesaid joint venture posted a profit of '106.31 Million during the year ended March 31,
2023.
Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5
of the Companies (Accounts) Rules, 2014, a statement containing salient features of the
financial statements of the subsidiaries and associate companies is given in form AOC-1
attached as Annexure 'A' to this Report.
In accordance with the provisions of Section 136 of the Companies Act,
2013, the Annual Report of the Company, containing the Standalone and Consolidated
Financial Statements along with the audited annual accounts of each subsidiary have been
placed on the Company's website i.e.
https://www.piindustries.com/investor-relations/co-go/ Subsidiary-Financial-Statements
10. RISK MANAGEMENT
The Company has a well-defined enterprise risk management framework in
place which interalia, includes identification of risks, including integration of new
mergers & acquisitions, sustainability, cyber security and related risks inherent to
operations of the Company. Risk management process has been established across the Company
and is designed to identify, assess and frame a response to threats that affect the
achievement of its objectives. Further, it
is embedded across all the major functions and revolves around the
goals and objectives of the organization. Major risks identified by the business and
functions are systematically addressed through mitigating actions on a continuing basis.
Pursuant to Regulation 21 of Listing Regulations, the Company has
constituted a Risk Management Committee of the Board. As on March 31, 2023, the Committee
comprises of 4 members including 1 Independent Director of the Company. The Committee met
on September 02, 2022 and February 28, 2023. The Committee is authorized to monitor and
review the risk management plan, apart from reviewing and recommending the modification to
the Risk Management Policy, if any.
Risk management policy
Risk Management Policy of the Company includes the identification,
assessment and control of elements of risk, which in the opinion of the Board may threaten
the existence of the Company.
11. INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY
The Company has in place adequate Internal Financial Controls with
reference to the Financial Statements commensurate with the size, scale and complexity of
its operations. The Company has identified and documented all key internal financial
controls as part of its Internal Financial Control reporting framework. The Company has
laid down well-defined policies and procedures for all critical processes across the
Company's plant, offices wherein financial transactions are undertaken. The policies and
procedures cover the key risks and controls in all the processes identified to the
respective process owner. In addition, the Company has a well-defined financial delegation
of authority, which ensures approval of financial transactions by appropriate personnel.
The Company uses SAP ERP to process financial transactions and maintain its books of
accounts to ensure its adequacy, integrity and reliability. The Company has also deployed
an online control tool to enhance the operating effectiveness of internal controls. The
control system comprises of continuous audit and compliance by an in-house internal audit
team supported by an appointed auditing firm. M/s Ernst & Young LLP have been engaged
as the Corporate auditors covering all central corporate functions along with the CSM
business vertical, and PKF Sridhar & Santhanam LLP who are covering the Agri Business
vertical along with Depot audit. The agencies perform the internal audit, and also assess
the internal controls and statutory compliances in various areas and provide suggestions
for improvement. Independence of internal auditors is ensured through direct reporting to
the Audit Committee. Internal Auditors independently evaluate the adequacy of internal
controls and concurrently audit the financial transactions and review the various business
processes. Internal Audit reports are placed before the Audit Committee of the Board.
Accordingly, the Board is of the opinion that the Company's internal
financial controls were adequate and effective as on March 31, 2023.
12. RELATED PARTY TRANSACTIONS
All arrangements / transactions entered by the Company with its related
parties during the year were in the ordinary course of business and on an arm's length
basis. During the year, the Company has not entered any arrangement / transaction with
related parties which could be considered material in accordance with the Company's Policy
on Related Party Transactions read with the Listing Regulations and accordingly, the
disclosure of Related Party Transactions in Form AOC - 2 is not applicable. However, names
of related parties and details of transactions with them have been included in Notes to
the financial statements.
Prior omnibus approval of the Audit Committee has been obtained for the
transactions which are foreseen and repetitive in nature. A statement of all Related Party
Transactions is presented before the Audit Committee for its review on a quarterly basis,
specifying the nature, value and terms and conditions of the transactions.
The Policy on Materiality of Related Party Transactions and on dealing
with related party transactions as approved by the Board is uploaded on the Company's
website i.e.
https://www.piindustries.com/Media/Documents/Policy%20on%20
Related%20Party%20Transactions.pdf
13. AUDITORS Statutory Auditor
The shareholders of the Company at 75th AGM held on September 03, 2022
had re-appointed M/s. Price Waterhouse Chartered Accountants, LLP, (ICAI Registration
No-012754N/N500016), as the Statutory Auditors of the Company for a second term of 5 years
and accordingly they hold their office from the conclusion of 75th AGM till the conclusion
of 80th AGM of the Company to be held in 2027. The Auditors' Report is unmodified i.e., it
does not contain any qualification, reservation or adverse remark or disclaimer.
Cost Auditor
Pursuant to the directives issued by the Central Government under
Section 148 of the Companies Act, 2013, an audit of the cost records relating to
Insecticides (Technical grade and formulations) manufactured by the Company is required to
be conducted by a cost auditor. The Board has appointed M/s K.G. Goyal & Co., Cost
Accountants, Jaipur, as Cost Auditors, based on the recommendation of the Audit Committee
for the conduct of the audit of cost records of Insecticides (Technical grade and
formulations) for the year ended March 31, 2023.
The Board of Directors on the recommendation of the Audit Committee has
approved the remuneration payable to Cost Auditors. In terms of Section 148 of the
Companies Act, 2013 and rules made thereunder, members are requested to consider the
ratification of remuneration payable M/s KG Goyal & Co., Cost Accountants.
As per Section 148 of the Companies Act, 2013, read with the Companies
(Cost Records and Audit) Rules, 2014, the Company is required to maintain cost records and
accordingly, such accounts and records are maintained.
Secretarial Auditor
The Board had appointed Mr. Rupinder Singh Bhatia (CP No.2514),
Practicing Company Secretary, as Secretarial Auditor to carry out Secretarial Audit in
accordance with the provisions of Section 204 of the Companies Act, 2013 and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, for the financial year
ended March 31, 2023. The Secretarial Audit Report for the financial year ended March 31,
2023 has been obtained and does not contain any adverse qualification, which requires any
comments from the Board. The Secretarial Audit Report for the financial year ended March
31, 2023, is annexed to this report as Annexure 'B'.
14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not given any guarantee during the year under review.
However, the details of loans and investments made under the provisions of Section 186 of
the Companies Act, 2013 are mentioned in the Notes to the financial statements.
15. DEPOSITS
The Company has not accepted any public deposits during the financial
year 2022-23 and no amount of principal or interest was outstanding as on March 31, 2023.
16. TRANSFER OF UNCLAIMED DIVIDEND AND SHARES TO INVESTOR EDUCATION AND
PROTECTION FUND
During the year, the Company had transferred an amount of '6,82,885/-
towards unclaimed dividend pending for more than seven years to the Investor Education and
Protection Fund. Pursuant to the provisions of Investor Education and Protection Fund
(Uploading of information regarding unpaid and unclaimed amounts lying with Companies)
Rules, 2012, the Company has uploaded the details of unclaimed amounts lying with the
Company as on the date of last AGM held on September 03, 2022, on the Company's website
and same is also available on the on the website of the Ministry of Corporate Affairs. The
details can be viewed at the Company's website i.e.
https://www.piindustries.com/investor-relations/sh-ce/
Shareholders-Information
Pursuant to the provisions of section 124 of the Companies Act, 2013
read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company
has transferred 1,800 equity shares on October 29, 2022, pertaining to shareholders in
respect of which dividend remained unclaimed for a period of seven consecutive years to
IEPF authority by way of corporate action through NSDL. The shareholders can claim their
shares by making an application in form IEPF-5 online with IEPF authority. Ms. Sonal
Tiwari, Company Secretary acts as a Nodal Officer of the Company for IEPF matters.
17. BOARD AND COMMITTEES Board of Directors
The Company's Board of Directors comprises an optimum blend of
Executive, Non-Executive and Independent Directors. The Chairperson of the Board is a
Non-Executive Non-Independent Director. As on March 31, 2023, the Board of Directors
comprised of eight (8) Directors out of whom two (2) are Executive Directors including
Vice Chairperson & Managing Director and Joint Managing Director apart from six (6)
Non-Executive Directors, out of which four (4) are Independent Directors including two (2)
Women Independent Directors and two (2) Non-Executive Non-Independent Directors. The
composition of the Board is in conformity with Regulation 17 of the Listing Regulations
and the relevant provisions of the Companies Act, 2013. The Board members possess
requisite qualifications and experience in general corporate management, strategy,
finance, banking, taxation, risk management, merger & acquisitions, human capital
& compensation, technology, legal and regulatory fields which enable them to
contribute effectively to the Company in their capacity as Directors of the Company.
Mr. Narayan K Seshadri (DIN: 00053563) completed his second consecutive
term as an Independent Director of the Company and ceased to be an Independent Director of
the Company from closing hours of September 05, 2022. Further, he has been appointed as a
Non-Executive Non-Independent Director of the Company w.e.f. September 06, 2022, pursuant
to approval granted by the shareholders in the AGM held on September 03, 2022.
Mr. Shobinder Duggal (DIN: 00039580) was inducted as Additional
Director on Board on November 12, 2021. Further, his appointment was regularised in the
AGM held on September 03, 2022 as Independent Director.
Ms. Pia Singh (DIN: 00067233) was inducted as an Additional Director on
the board w.e.f. August 03, 2022. Further, her appointment was regularised in the AGM held
on September 03, 2022, as Independent Director.
In accordance with the provisions of the Companies Act, 2013 and
Articles of Association of the Company, Mr. Arvind Singhal (DIN: 00092425) retires by
rotation at the forthcoming AGM and being eligible, offers himself for re-appointment. The
Board recommends his re-appointment for the approval of the members at the forthcoming
AGM. Brief details of Mr. Arvind Singhal are given in the notice of AGM.
Dr. Raman Ramachandran (DIN: 00200297) resigned from the position of
Non-Executive Non-Independent Director on the Board w.e.f. July 01, 2022, to pursue other
interests in management and coaching. He has confirmed that there is no other material
reason for resignation other than that mentioned in his resignation letter. The Board
placed on record its appreciation for the services provided by him during his association
with the Company.
Ms. Ramni Nirula (DIN: 00015330) completed her second consecutive term
as an Independent Director of the Company and ceased to be Independent Directors of the
Company from closing hours of September 05, 2022. The Board placed on record its
appreciation for the services provided by her during his association with the Company.
Mr. Pravin K. Laheri (DIN: 00499080) completed his second consecutive
term as an Independent Director of the Company and ceased to be Independent Directors of
the Company from closing hours of September 05, 2022. The Board placed on record its
appreciation for the services provided by him during his association with the Company.
There has been no other change in the Directors during the year under
review since the last report.
Declaration by Independent Directors
The Company has received declaration(s) from all the Independent
Directors confirming that they meet the criteria of independence provided under section
149(6) of the Act and regulation 16 of the Listing Regulations. The Independent Directors
have also confirmed compliance with the provisions of rule 6 of Companies (Appointment and
Qualifications of Directors) Rules, 2014, as amended, relating to inclusion of their name
in the databank of independent directors.
The Board took on record the declaration and confirmation submitted by
the independent directors regarding them meeting the prescribed criteria of independence,
after undertaking due assessment of the veracity of the same in terms of the requirements
of regulation 25 of the Listing Regulations.
Details, as required under the Companies Act, 2013 and Listing
Regulations, in respect of Directors seeking appointment/re- appointment subject to the
approval of shareholders at the ensuing AGM are given in the notice of AGM.
Changes in Key Managerial Personnel
Mr. Naresh Kapoor resigned as Company Secretary of the Company w.e.f.
June 16, 2022. The Board placed on record its appreciation for the services provided by
him during his association with the Company.
Ms. Sonal Tiwari was appointed as the Company Secretary of the Company
w.e.f. December 10, 2022.
There has been no change in other Key Managerial Personnel of the
Company during the year under review since the last report.
Evaluation of the Board's Performance
In compliance with the provisions of Companies Act, 2013 and Regulation
17(10) of the Listing Regulations, an annual evaluation of the performance of the Board,
Individual Directors as well as evaluation of the working of its committees was carried
out by an external agency during the year under review. The evaluation framework for
assessing the performance of Directors including the Chairperson of the Board comprised of
criteria such as quality of
contribution to the Board deliberations, strategic inputs regarding
growth of the Company and its performance, attendance at Board meetings and Committee
meetings, independence of judgements, safeguarding the interest of the Company and
commitment to stakeholders' interests.
The Board and Nomination and Remuneration Committee at their meetings
held on May 18, 2023, based on the report of performance evaluation, determined as
required under law that the appointment of all independent directors may continue.
Number of Board meetings conducted during the year under review
During the year under review, seven (7) Board meetings were held on May
17, 2022, August 03, 2022, August 10, 2022, November 08, 2022, December 10, 2022, February
14, 2023 and March 06, 2023. Facility to attend meetings through video conference mode was
provided for all meetings of the Board. The details of the Board meetings and attendance
of the Directors are provided in the Corporate Governance Report.
Composition of Committees
Audit Committee
As on March 31, 2023, Audit Committee comprises of 4 members with Mr.
Shobinder Duggal, Independent Director as the Chairperson,
Mr. Narayan K. Seshadri, Ms. Lisa J. Brown and Ms. Pia Singh as
members. Further, details on the Committee meetings held are given in the Corporate
Governance Report.
All recommendations of the Audit Committee were accepted by the Board.
Stakeholder's Relationship Committee
The Stakeholder's Relationship Committee comprises of 3 members with
Dr. T.S. Balganesh, Independent Director as the Chairperson, Mr. Shobinder Duggal and Mr.
Rajnish Sarna as the members. Further, details on the Committee meetings held are given in
the Corporate Governance Report.
A detailed update on the Board, its composition, detailed charter
including terms and reference of various Board Committees, number of Board and Committee
meetings held during FY 2022-23 and attendance of the Directors at each meeting is
provided in the Report on Corporate Governance, which forms part of this Report.
Directors Responsibility Statement
In accordance with the provisions of Section 134(5) of the Companies
Act, 2013, the Board hereby submits its responsibility statement: -
(a) in the preparation of the annual accounts for the year ended March
31, 2023, the applicable accounting standards had been followed;
(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 as at March 31, 2023
and of the profit 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 ensuring
the orderly and efficient conduct of its business including adherence
to Company's policies, the safeguarding of its assets, the prevention and detection of
frauds and errors, the accuracy and completeness of the accounting records and the timely
preparation of reliable financial information 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.
18. ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act, 2013 read with Rule 12
of the Companies (Management and Administration) Rules, 2014, the copy of Annual Return in
the prescribed form, which will be filed with Registrar of Companies/MCA, can be accessed
at the Company's website i.e.
https://www.piindustries.com/investor-relations/co-go/annual-
return
19. SECRETARIAL STANDARDS OF ICSI
The Company has devised proper systems and processes for complying with
the requirements of applicable Secretarial Standards issued by the Institute of Company
Secretaries of India and that such systems were adequate and operating effectively.
20. REMUNERATION POLICY OF THE COMPANY
The Remuneration Policy of the Company comprising the appointment and
remuneration of the Directors, Key Managerial Personnel and Senior Executives of the
Company including the criteria for determining qualifications, positive attributes,
independence of a Director and other related matters have been provided in the Corporate
Governance Report, which forms part of this Report.
'Caring', 'Creative', 'Courageous' and 'Curious' are our Values which
guide and propel us towards living our Purpose of 'Reimagining a healthier planet'. Our
work culture encourages innovation which in turn enables us to recharge, explore new
opportunities, and deliver business goals. In this growth trajectory, our diverse human
capital plays the most significant role. At PI, we are committed to attract, onboard,
develop, engage, and retain diverse talent to ensure sustainable growth. Our talent
philosophy offers all-round developmental opportunities for employees across the board.
Our focus on technology driven processes & solutions encourages our employees to
upskill themselves in the latest technological advancements in their domains. As an
organization, we stay committed towards a strong employer brand, creating a diverse
workforce, supporting the wellbeing of our people and care for their overall success.
Policy on Prohibition, Prevention and Redressal of Sexual Harassment at
Workplace
The Company has a zero tolerance for any abuse against women at
workplace. The Company has adopted a Policy on Prohibition, Prevention and Redressal of
Sexual Harassment of Women at Workplace and matters connected therewith or incidental
thereto covering all the aspects as required under the "The Sexual Harassment of
Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013". The Company
has constituted an Internal Complaints Committee (ICC) known as Prevention of Sexual
Harassment (POSH) Committee to enquire into complaints of sexual harassment and recommend
appropriate action. The Company received 3 (three) complaints under POSH during the
financial year 2022-23. All the complaints were disposed of during the period and there
were no complaints pending as on March 31, 2023.
Particulars of Employees and related disclosures
The information required under Section 197(12) of the Companies Act,
2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 forms part of this Report and annexed as Annexure 'C'. As per first
proviso to Section 136(1) of the Act and second proviso of Rule 5(2) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the report and
financial statements are being sent to the members of the Company excluding the statement
of particulars of employees under Rule 5(2). However, these are available for inspection
during business hours up to the date of the forthcoming AGM at the registered office of
the Company. Any member interested in obtaining a copy of the said statement may write to
the Company Secretary at the Registered Office address of the Company.
Employee Stock Option Plan / Scheme
The Company discontinued the grant of stock options under PII- ESOP
Scheme, 2010 in the year 2017 as per the recommendation(s) of Nomination and Remuneration
Committee of the Board. However, the stock options already granted, vest as per the terms
and conditions contained in the grant letter. As per the Company's ESOP scheme, options
vest after a lock in period of one (1) year from the date of grant in a graded manner over
the vesting period of four (4) years. The exercise price of stock options granted have
been arrived by giving discount to the closing market price of the equity share on
National Stock Exchange India Limited one day prior to the date of grant of option. No
employee has been issued stock options equal to or exceeding 1% of the issued capital of
the Company at the time of grant. Details of options as required under SEBI (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021 is uploaded at the Company's website
i.e. https://www.piindustries.com/investor-relations/co-go/Other- Disclosures
During the year under review, there has been no change in the PII- ESOP
Scheme, 2010. PII-ESOP Scheme, 2010 is in compliance with SEBI (Share Based Employee
Benefits and Sweat Equity) Regulations, 2021, and this has been certified by the
secretarial auditor of the Company.
21. VIGIL MECHANISM - WHISTLE BLOWER POLICY
The Company has an established vigil mechanism for Directors and
employees to report their genuine concerns, as approved by the Board on the recommendation
of the Audit Committee. The Whistle Blower Policy of the Company is formulated and
uploaded on the Company's website i.e.
https://www.piindustries.com/Media/Documents/Whistle%20
Blower%20Policy(r).pdf
The Policy provides for adequate safeguards against victimization of
employees who avail of the mechanism and provides for direct access to the Chairperson of
the Audit Committee. It is affirmed that no personnel of the Company have been denied
access to the Audit Committee.
22. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information pertaining to conservation of energy, technology
absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the
Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is
furnished in Annexure 'D' attached to this report.
23. CORPORATE SOCIAL RESPONSIBILITY ("CSR")
In accordance with the requirements of Section 135 of the Companies
Act, 2013, the Company has a CSR Committee comprising four (4) members with Ms. Pia Singh
as Chairperson, Mr. Mayank Singhal, Mr. Rajnish Sarna and Dr. T.S. Balganesh as Members.
During FY 2022- 23, the Committee met four times. The details of meetings and attendance
thereat forms part of the Annual Report on CSR activities furnished in Annexure 'E'
attached to this report.
The CSR obligation of the Company for FY 2022-23 was ^165.17 Million.
As on March 31, 2023, total amount spent on CSR activities by Company was ^137.24 Million.
The unspent amount of ^27.93 Million was transferred to "Unspent CSR Account" of
the Company within a period of thirty days from the end of financial year.
In terms of the provisions of the Act read with Companies (Corporate
Social Responsibility Policy) Rules, 2014, the Annual Report on CSR activities is annexed
to this Report. Detailed information on CSR Policy, its salient features, CSR initiatives
undertaken during the year, details pertaining to spent and unspent amount forms part of
Annual Report on CSR activities.
The CSR policy is hosted on the Company's website i.e.
https://www.piindustries.com/sustainabilitv/CSR/CSR-Policv
Further, the Chief Financial Officer has certified that the funds
disbursed have been utilised for the purpose and in the manner approved by the Board for
the FY 2022-23.
24. CORPORATE GOVERNANCE
The Company takes pride in its Corporate Governance structure and
strives to maintain the highest possible standards. A detailed report on the Corporate
Governance code and practices of the Company along with a certificate from the auditors of
the Company regarding compliance of the conditions of Corporate Governance as stipulated
under Regulation 34 of SEBI (LODR) Regulations, 2015 forms part of the Report.
25. MANAGEMENT DISCUSSION AND ANALYSIS
A detailed report on the Management Discussion and Analysis is provided
separately forms part of the Annual Report.
26. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
A separate section of Business Responsibility and Sustainability
describing the initiatives taken by the Company from an environmental, social and
governance perspective, forms part of this Annual Report as required under Regulation
34(2)(f) of Listing Regulations.
27. INCLUSION IN TOP 100 LISTED ENTITIES
The Company has been included in the list of top 100 listed entities as
per market capitalization as on December 31, 2022.
28. GENERAL
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions on these items during the
year under review: -
a) Issue of equity shares with differential rights as to dividend,
voting or otherwise.
b) Issue of shares (including sweat equity shares) to employees of the
Company.
c) Neither the Managing Directors nor the Whole-time Director of the
Company received any remuneration or commission from any of its subsidiaries.
d) No significant or material orders were passed by the Regulators or
Courts or Tribunals, which impact the going concern status and Company's operations in
future.
e) Other statutory disclosures
• The auditors, i.e., statutory auditors, secretarial auditors and
cost auditors have not reported any matter under section 143(12) of the Act, and
accordingly, details as required to be disclosed under section 134(3)(ca) of the Act, have
not been furnished.
• There is no change in the nature of business of the Company
during FY2022-23.
• A Cash Flow Statement for the FY 2022-23 is attached to the
Balance sheet.
• The securities of the Company were not suspended from trading
during the year.
• There have been no material changes and commitments, if any,
affecting the financial position of the Company which have occurred between the end of the
financial year of the Company to which the financial statements are related and the date
of the report.
29. ACKNOWLEDGEMENTS
Your Directors wish to express their grateful appreciation for the
valuable support and co-operation received from bankers, business associates, lenders,
financial institutions, shareholders, various departments of the Government of India, as
well as the State Governments of Rajasthan & Gujarat, the farming community and all
our other stakeholders.
Your Directors place on record their appreciation of the valuable
contribution made by the employees of the Company.
The Board places on record its sincere appreciation towards the
Company's valued customers in India and abroad along with its joint venture partners for
the support and confidence reposed by them in the organization and looks forward to the
continuance of this supportive relationship in the future.
Your Directors acknowledge the contribution and hard work of the
employees of the Company and its subsidiaries at all levels, who, through their
competence, hard work, solidarity and commitment have enabled the Company to achieve
consistent growth.
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