L T Foods Ltd
Chairman Speech
We are building a sustainable business and contributing to a healthier future for all
Dear Shareowners,
The year gone by began on a promising note for the world economy, but a3er a few months
the momentum began to peter out. The deceleration was the result of several factors such
as rising crude prices, US-China trade stando3, disruptions in the German auto sector,
tariff warfare among major nations, threats of protectionism, along with greater policy
ambiguity.
Although the country's GDP growth declined to 6.8% in FY2018-19 from 7.2% in FY2017-18,
the overall economic outlook is largely positive. The economy now is in a state of
formalisation and consolidation with strong transitional undercurrents, which are acting
as a force multiplier.
The country's economy is primarily steered by its predominantly young and aspiring
population, greater affinity towards brands and premiumisation, faster urbanisation and
infrastructure creation and above all enhanced ease of doing business. These trends augur
well for our business. It is also pertinent to mention in this context that the rapid
rollout of contemporary retail format stores and stronger marketing efforts by companies
have facilitated the growth of basmati rice consumption in the domestic market. The
outlook for the domestic basmati rice consumption is favourable, supported by demand
improvement from the international market and potential upside from branded
demand/premiumisation in domestic markets.
To give you a perspective, basmati rice exports from India reached `32,000 crore during
FY2018-19. As one of India's leading basmati rice exporters, we are confident that the
future roadmap continues to hold out considerable optimism. Against this general positive
backdrop, let us now try to evaluate our performance for FY2018-19 and try to identify our
growth pivots, which will drive our organisation to the next level of value creation.
Sustainable growth in India
It is gratifying to report another year of encouraging performance. Revenue grew by 7%
to 33,915 crore in FY2018-19 from 33,650 crore in FY2017-18. Our leading brands such as
Daawat, Heritage, Rozana, Devaaya, etc. in India as well as Royal, Gold Seal Indus Valley,
817 Elephant globally contributed to this growth. We delivered an EBITDA of 3421 crore in
FY2018-19 as against 3414 crore in FY2017-18. Additionally, our profit a3er tax stood at
3137 crore in FY2018-19 as against 3144 crore in FY2017-18. Our revenue from basmati
exports stood at 32,103 crore in FY2018-19 as compared to 31,896 crore in FY2017-18, up by
11%. We further strengthened our presence across India as well as in international markets
by continuously investing in brands that accounted for greater market share across
categories.
The overall demand for basmati rice continues to be high and we are well positioned to
capitalise on this growth opportunity. Our branded business in India recorded sales of
3947 crore in FY2018-19 as compared to 3892 crore in FY2017-18 owing to improved
realisations from branded products. Moreover, our consumer pack business reported a growth
of 8% to 31,941 crore in FY2018-19 as compared to 31,794 crore in FY2017-18.
We firmly believe in the idea of keeping pace with changing consumer needs and
preferences. Therefore, in addition to growing the basmati rice business over the years,
we have leveraged our brand to foray into the segment of value-added products (VAP). Our
offerings comprise specialty rice across di3erence price points, as well as organic food,
saut sauces, rice-based snacks and rice-based convenience products. We successfully
launched premium rice-based snacks brand ‘Kari Kari' for the Indian market with JV
partner, Kameda Seika. We are setting up a unit in Haryana and expect commercial
production of Kari Kari offerings to start during FY2019-20. We are going to launch Daawat
Saut Sauces to offer greater convenience to consumers by ensuring its availability
across all important towns in India in addition to major e-commerce platforms a3er
successful test launch for one year in selected geographies.
Accelerating global endeavours
Our capabilities in the US and the EU improved as a result of greater market
penetration. We are solidifying our presence in other regions across the Middle East and
Africa through organic and inorganic routes. Our overall international business touched
32,103 crore in FY2018-19 as against 31,896 crore in FY2017-18. North America has been one
of the strongest international markets for us, where the brand ‘Royal' contributes
significantly to overall branded revenues and takes up 45%+ of the US market. Further, the
acquisition of the 817 Elephant brand has enabled us to achieve leadership position in
Canada. During the year under review, Daawat gained leadership position in Israel and
Reunion Island, among others.
We have introduced a range of new, organic ready-to-heat (RTH) products for the
overseas market with a facility in the US. The new RTH foods facility in Houston, US,
manufactures 2-minute retort rice in order to fortify our footprint in the high potential
market. Our processing and packaging facility in Europe is scaling up and will serve
rising demand across the continent. In Europe, we grew our ethnic business and added new
supermarket customers for our private label. We launched new avatar of Daawat in the UK
and Europe across all price segments with enhanced focus on the catering and consumer
channels. All our brands are performing well across geographies and we will make greater
efforts to nurture them and leverage their potential and distribution globally.
Growth avenues
Our subsidiary Nature Bio Foods Ltd. (NBFL) has secured equity funding from Rabobank's
India Agri Business Fund II with a proposed investment of `140 crore. NBFL received the
first tranche of `60 crore in FY2018-19. The second tranche is expected to come in
FY2019-20.
Continued support from India Agri Business Fund reflects strong confidence in the
management's strategic growth outlook. These capabilities created in the backend under the
global organic food ingredients business are likely to support our growth operations
across the world.
Research collaborations
We are focused on the next level of innovation. We signed a memorandum of understanding
(MoU) with Wageningen Food & Biobased Research (WFBR), Netherlands, to promote
co-operation in the field of research and education. Our collaboration will help
accelerate the progress of research, education and training in various research
disciplines to strengthen the best practices followed by us at farm level for procurement
of paddy and improve compliance with MRL standards in line with global requirements. With
our wide customer base both in India and international markets, we will benefit from the
exchange of innovative technologies that will aid in better alignment with global
food/produce standards. The agreement will also enable us and WFBR to encourage and
establish exchange of collaborative scientific research.
Team counts
We believe our success is the outcome of the efficiency of our people and it is their
expertise, experience and enthusiasm that drive us. With a congenial work culture, a focus
on learning and development—that help our people sharpen their skills with focused
training initiatives—and a proven reward and recognition programme, we nurture our
people and help them grow in the organisation.
Caring for community
We believe in sustainable co-existence with communities around us, with focus on
enhancing their quality of life. LT Foods Limited CSR policy and Fair Farming Foundation
(supported with fair trade and social development fund, along with CSR Fund) represent our
twin social engagement programmes, which help us address the requirements of communities
in our vicinity. We continue to develop rural infrastructure and improve the quality of
education in rural schools.
Future perfect
We have rolled out a five-year roadmap with an eye on the future. Our objective is to
be a preferred brand for our consumers across geographies. We would also like to remain
category leaders in key markets and continue to outperform industry growth. We are keeping
consistent focus on building scale, enhancing procurement efficiencies, improving
manufacturing yield and improving operating efficiencies along with solidifying our brands
across geographies. Going forward, our market leadership will be clearly driven by higher
margins and profitability. With your help and support, we will continue to strengthen our
business with a broader sustainability agenda and contribute to a healthier future for
all.
| Warm regards |
|
| Vijay Kumar Arora |
Ashwani Kumar Arora |
| Chairman |
Chief Executive Officer & |
|
Managing Director |
  Â
L T Foods Ltd
Directors Reports
To,
The Members,
Your Directors take pleasure in presenting their 29th Annual Report on the business and
operations of the Company and the accounts for the financial year ended March 31, 2019.
| 1. FINANCIAL PERFORMANCE OF THE COMPANY (STANDALONE) |
|
|
|
|
( ` In lakhs) |
|
Financial Year |
Financial Year |
| Particulars |
|
|
|
(2018-19) |
(2017-18) |
| Gross Income |
221,009.09 |
215,665.84 |
| Profit Before Interest and Depreciation |
18,302.79 |
15,697.02 |
| Finance Charges |
7,644.44 |
8,529.51 |
| Gross Profit |
41,137.28 |
39,967.55 |
| Provision for Depreciation |
2,336.18 |
1,810.23 |
| Net Profit Before Tax |
8,322.17 |
5,357.28 |
| Net Profit A_er Tax |
5,448.54 |
4,195.54 |
| Balance of Profit brought forward |
29,917.83 |
26,328.58 |
| Balance available for Appropriation |
34,820.38 |
29,917.82 |
| Proposed Dividend on Equity Shares |
479.76 |
400.12 |
| Tax on proposed Dividend |
98.62 |
81.45 |
| Transfer to General Reserve |
Nil |
Nil |
| Surplus carried to Balance Sheet |
34,820.38 |
29,917.82 |
2. COMPANY'S WORKING DURING THE YEAR
On standalone basis, our total revenue stood at ` 2210 crore higher by 2.5%
year-on-year. The gross profit stood at ` 411 crore. Profit after tax stood at ` 54 crore
as compared to ` 42 crore in FY 2017-18, representing a growth of 30% year-on-year. This
led to resultant EPS of ` 1.70 per share by 14%. EPS is based on fully diluted basis
adjusted for the stock split from ` 10 per share to ` 1 per share.
Our consolidated revenue stood at ` 3,915 crore higher by 7% year-on-year driven by
higher contribution of branded sales. The gross profit stood at 976 crore. EBITDA stood at
421 crore, an increase of 2% on year-on-year basis translating to EBITDA margin to 10.8%
as compared to 11.3% in the last year.
Our consolidated profit before tax during the year stood at
` 214 crore. Profit after tax stood at ` 137 crore as compared to ` 144 crore in
financial year 2019. This led to resultant improvement in EPS to ` 3.96 per share. EPS is
based on fully diluted basis adjusted for stock split from ` 10 per share to ` 1 per
share. Moving on geographical revenue and realisation breakup branded India sales stood at
` 947 crore up by 6% year-on-year while the average realisation during the year increased
to ` 53 per kg resulting in an increase of 3%. International branded sales came in at `
1371 crore a growth of 11% while the average realisation increased to ` 103 per kg higher
by 8%.
Our organic business, stood at ` 372 crore, up by 3% contributing 9.5% to the overall
revenue.
The focus has been on strengthening the consumer business both in India and
theInternational market, which is depicted in the overall growth of our consumer business
that is 8%.
Our Branded business has grown by 9% in value terms on year-on-year basis in FY
2018-19, that was primarily driven by an increase of 6% in India and 11% in International
branded business.
The contribution of branded business to overall basmati rice volumes increased from 69%
to 70% in financial year 2018-2019 driven by consistent brand investments, strengthening
the supply chain, adopting channel wise strategy to strengthen out footprint in all the
channels, be it the general trade, modern trade or wholesale or online business.
Our credit rating has also been reaffirmend by CRISIL to A-with Positive outlook for
the financial year 2018-19.
3. CHANGE IN THE NATURE OF BUSINESS, IF ANY-
During the year under review, there were no major changes in the business.
4. DIVIDEND
The Board of Directors recommended ` 0.15 per share dividend for FY 2018-19 and decided
to retain the remaining earnings.
5. RESERVES
Out of the amount available for appropriation, the Company's Directors proposed to
transfer no sum to the General Reserve and retain ` 29,917.82 lakhs in the profit and loss
account.
6. SHARE CAPITAL
The paid up equity share capital of the Company as on March 31, 2019 was ` 3,198 lakhs.
There has been no change is share capital during the year 2018-19.
7. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL APPOINTMENT AND RESIGNATION
DURING THE YEAR
During FY 2018-19, there were no recorded appointment or resignation of Director or Key
Managerial Personnel.
8. PARTICULARS OF EMPLOYEES AND EMPLOYEE REMUNERATION
Pursuant to the Companies (Appointment and Remuneration of Managerial Personnel)
Amendment Rules, 2016, The information required is as follows:
| Managerial Remuneration: |
|
| 1. Ratio of remuneration of each director to median remuneration of employees |
|
| Vijay Kumar Arora |
1:33 |
| Ashwani Kumar Arora |
1:33 |
| Surinder Kumar Arora |
NA |
| 2. Percentage increase in remuneration of each director and KMPs |
|
| Vijay Kumar Arora |
10% |
| Surinder Kumar Arora |
Nil |
| Ashwani Kumar Arora |
10% |
| Monika Chawla Jaggia |
Nil |
| 3. Percentage increase in the median remuneration of employees |
NA |
| 4. Number of permanent employees |
897 |
| 5. Average percentile increase in salary of employees, other than managerial
personnel, comparison with percentile increase in managerial remuneration and
justification |
|
| Managerial Increase |
Nil |
| Non-managerial increase |
6% |
| 6. Affirmation that the remuneration is as per the remuneration |
Yes |
| policy of the Company |
|
As per rule 5(3) of Companies (Appointment and Remuneration) Rules, 2014, the employees
who draw salary exceeding the limits of `1.02 Crore is as follows:
| Name |
Designation |
Remuneration |
Nature of employment |
Qualification |
Experience |
Age |
Last employment |
% of shares held |
|
|
(in crore) |
|
|
|
|
|
|
| Vijay Kumar Arora |
Managing Director |
2.11 |
Permanent |
B.Sc. |
43 |
61 |
NA |
6.66 |
| Ashwani Kumar Arora |
Managing Director |
2.11 |
Permanent |
B.Com |
31 |
52 |
NA |
6.66 |
9. BOARD MEETINGS
During the year, six Board meetings were held, the dates on which these meeting were
held are May 24, 2018, August 13, 2018, August 31, 2018, November 14, 2018, February 05,
2019 and March 06, 2019. The details of the same is given in the Corporate Governance
Report. The intervening gap between the meetings was within the period prescribed under
the Companies Act, 2013.
10. PERFORMANCE EVALUATION
In pursuance of Section 178 of the Companies Act, 2013 read with Regulation 4(2),
17(10) and 19(4), read with Schedule II Part D of the Securities and Exchange Board of
India (Listing Obligations and Disclosure Requirements), Regulations, 2015 and Secretarial
Standards-I, the Nomination and Remuneration Committee has framed the performance
evaluation process of Independent Directors, Executive Directors and the Board as a whole
as well as functioning of its Audit, Nomination and Remuneration Committee, CSR Committee,
Governance Committee Stakeholders and Relationship Committee, etc. has been carried out
during FY 2018-19.
The Independent Directors of the Company met separately on February 05, 2019 without
the presence of Non-independent Directors and inter-alia reviewed the performance of the
members of the Management, Non-independent Directors, and the Board as a whole.
Additionally, the performance of the Chairman of the Company and the functioning of the
Committees were evaluated taking into consideration the views of the Executive and the
Non-executive Directors.
In compliance with the provisions of SEBI Listing Regulations, the Board of Directors
also carried out evaluation of every Independent Director's performance during the year.
The Board members submitted to the Nomination and Remuneration Committee, their response
on a scale of 1 to 5 (Performance needs improvement to Excellent), for evaluating the
entire Board, and respective Committees including Chairman of the Board.
The Nomination and Remuneration Committee also carried out evaluation of every
Director's performance. The Board has duly completed with the evaluation process.
It was further acknowledged that every individual member and Committee of the Board has
contributed to the best of their potential to the growth of the organisation.
11. STATEMENT OF DECLARATION BY AN INDEPENDENT DIRECTOR(S) AND RE- APPOINTMENT
All the Independent Directors have given their independency declaration as provided in
sub-section (6) of Section 149 of the Companies Act, 2013.
12. REMUNERATION POLICY
The Company has framed the Remuneration policy in compliance with Section 178 of the
Companies Act, 2013, read along with the applicable rules and Regulation 19 of Securities
and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations,
2015. The Remuneration policy of the Company is in compliance with Section 178 (4) of the
Companies Act, 2013. The Remuneration policy can be referred to at weblink http://
www.ltgroup.in/pdf/LT-Foods-Remuneration-Policy.pdf
The salient features of the Remuneration policy are as follows:
• To formulate a criteria for determining qualifications, positive attributes and
independence of a Director
• To recommend to the Board, the appointment,
Remuneration payable and removal of Senior Management
• To carry out evaluation of Director's performance and recommend to the Board
appointment/removal based on his/her performance.
• To advise the Board on (i) policy relating to remuneration for Directors, Key
Managerial Personnel and Senior Management and (ii) Executive Directors' remuneration and
incentive
• To make recommendations to the Board concerning any matters relating to the
continuation in office of any Director at any time including the suspension or termination
of service of an Executive Director as an employee of the Company, subject to the
provision of the law and their service contract
• To ensure that level and composition of remuneration is reasonable and
sufficient, relationship of remuneration to performance is clear and meets appropriate
performance benchmarks
• To devise a policy on Board diversity
• To develop a succession plan for the Board with segregated succession readiness
of the management council and executive.
13. DETAILS OF SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES
Pursuant to sub-section (3) of Section 129 of the Act, the document containing salient
features of the financial statement of Company's subsidiaries, associate or joint venture
is given as Annexure-V [Performance and financial position of each of the subsidiaries,
associates and joint venture companies included in the consolidated financial statement].
During the year, the Company generated a revenue of ` 3915 crore at group level. Its
subsidiaries played a major role in contributing to the overall revenue. LT Foods,
Americas (formerly known as Kusha Inc, the fellow subsidiary of the Company, contributed
~35% to the overall revenue. . The organic arm NBFL, a wholly owned subsidiary contributed
~9% to the group revenue.
Additionally, the annual accounts and related documents of the subsidiary company will
be kept open for inspection at the registered and the corporate office of the Company. The
Company will also make available copy thereof, upon specific request by any member of the
Company interested in obtaining the same. Besides, pursuant to Accounting Standard AS-21
issued by the Institute of Chartered Accountants of India, Consolidated Financial
Statements presented by the Company in this Annual Report include the financial
information of its subsidiary.
Name of the Companies, which became or ceased to become Subsidiaries/Joint
Ventures/Associates Companies during the year.
During the year, the Company's subsidiary Nature Bio Foods Limited incorporated a
wholly owned subsidiary Ecopure Specialties Limited. The Company has written off its
investment made in Joint venture Company Genoa Rice Mills Private Limited. Raghuvesh Power
Projects Limited and Nature Bio Foods Inc ceased to be fellow subsidiary due to their
strike off/winding up during the year. Raghuvesh Foods
& Infrastructure Limited, a wholly owned subsidiary of the company has applied to
ROC for striking off under Section- 248 and the same was under process of striking
off.
14. AUDITORS
M/s. Walker Chandiok & Co. LLP, Chartered Accountants were appointed as Statutory
Auditors of the Company at the Annual General Meeting held on September 18, 2015, for a
term of five consecutive years. As per the provisions of Section 139 of the Companies Act,
2013, the appointment of Auditors is required to be ratified by members at every Annual
General Meeting.
However, in accordance with the Companies Amendment Act, 2017, enforced on May 7, 2018
by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not
required to be ratified at every Annual General Meeting.
The Auditor has confirmed that they are not disqualified under any provisions of
Section 141(3) of Companies Act, 2013 and also their engagement with the Company is within
the prescribed limits under Section 141 (3)(g) of Companies Act, 2013.
15. AUDITORS' REPORT
The Auditors' Report does not contain any qualification. Notes to Accounts and Auditors
remarks in their report are self-explanatory and do not call for any further comments.
There were no instances of fraud reported by the Statutory Auditors under
Section-143(12) of the Companies Act, 2013, read with rules framed thereunder, either to
the Company or the Central Government.
16. AUDIT COMMITTEE
In pursuance of Section 177 of the Companies Act, 2013, read with Regulation 18 of
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Company has constituted the Audit Committee and the details with
respect to the composition of the Audit Committee of the Company is given in its Corporate
Governance Report.
17. SECRETARIAL AUDIT REPORT
In terms of Section 204 of the Act and rules made there under, M/s. D Dixit &
Associates, practicing Company Secretary has been appointed as Secretarial Auditors of the
Company. The report of the Secretarial Auditors is enclosed as Annexure IV with this
report. The point-wise comments are enumerated as follows.
Reply to the observations in the Secretarial Audit
(i) Delay in filing forms- Due to oversight, the Company has delayed in filing some of
the forms within prescribed time frame of the Companies Act, 2013. The applicable
additional fees has been paid to Ministry of Corporate Affairs
(ii) CSR spent - The Company has not spent the entire amount on CSR. It will spend the
entire amount in the coming years in compliance with Section-135 of the Companies Act,
2013
(iii) Gratuity payment to ex- employees- The Company has duly paid gratuity to
ex-employees of the Company.
18. INTERNAL AUDIT AND CONTROLS
In terms of compliance of Section 138 of the Companies Act, 2013, read with the
Companies (Accounts) rules, 2014, the Company continues to engage Pro Advisory India LLP
as its Internal Auditors. During the year, the Company continued to implement their
suggestions and recommendations to improve the control environment. Their scope of work
includes review of processes for safeguarding the assets of the Company, operational
efficiency, effectiveness of systems and processes, statutory compliances, and assessing
the internal control strengths in all areas. Internal Auditors' findings are discussed
with the process owners and suitable corrective actions are taken as per the directions of
the Audit Committee on an ongoing basis to improve efficiency of operations.
19. VIGIL MECHANISM
In pursuant to the provisions of Section 177(9) and (10) of the Companies Act, 2013, a
Vigil Mechanism for Directors and employees to report genuine concerns has been
established. The Vigil Mechanism policy can be found at www.ltgroup.in, under
investors/policy documents/Vigil Mechanism Policy on the website of the Company. In terms
of amendment in regulation 9A(6) of the SEBI (Prohibition of Insider Trading) Regulations,
2015, there is a mandate of a listed Company to have a whistle-blower policy and make
employees aware of such a policy to enable them to report instances of leak of unpublished
price sensitive information. The company already has a whistle blower policy in place,
which has been formulated in accordance with the Listing agreement. The presence of this
policy has been communicated to the employees through an internal circular, so as to
apprise them of their right to report any instance of leak or suspected leak of UPSI.
20. RISK MANAGEMENT POLICY
The Company has in place comprehensive risk assessment and minimisation procedures,
which are reviewed by the top management at regular intervals.
21. EXTRACT OF ANNUAL RETURN
Pursuant to the requirements of Section 92(3) of the Companies Act, 2013 and rule 12(1)
of the Companies (Management and Administration) Rules, 2014, an extract of the annual
return in MGT 9 has been made a part of this Annual Report as Anneure I. The annual return
can also be found at www.ltgroup.in, under investors updates
http://ltgroup.in/pdf/Annual%20Return-2019.pdf on the website of the Company
22. Material changes and commitments, if any, affecting the financial position of the
Company which have occurred during the period, beginning with end year of the Company to
which the financial statements relate and the date of the Report
There has been no material changes in the business, which may affect financial position
of the Company.
23. Details of significant and material orders passed by the regulators or courts or
tribunals impacting the going concern status and the Company's operations in future
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
the Company's operations in future.
24. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL
FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
According to Section-134 (5) (e) of the Companies Act, 2013, the term Internal
Financial Control (IFC) means the policies and procedures adopted by the Company for
ensuring orderly and efficient conduct of its business including adherence to the
Company's policies, the safeguarding of its assets, prevention and detection of frauds and
errors, the accuracy and completeness of the accounting records, and the timely
preparation of reliable financial information.
The Company has a well-placed internal financial control system, which ensures that all
assets are safeguarded and protected, and that the transactions are authorised, recorded
and reported correctly. The Company's internal financial control system also comprises due
compliances with Company's policies and Standard Operating Procedures (SOPs) and audit and
compliance by Internal Audit team, Pro Legal Advisory, India, LLP.
25. DEPOSITS
The Company has neither accepted nor renewed any deposits falling under Chapter V of
the Companies Act, 2013.
26. COST RECORD
The Central Government has not specified maintenance of cost record under section
148(1) of the Companies Act, 2013 with respect to our Company's product.
27. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not granted any loans falling within the preview of Section 186 of the
Companies Act, 2013, however the details of Investments made and security or guarantee
given are as follows : Details of investments:
|
Date of investment |
Name of the Company |
Amount – (` In lakhs) |
Purpose for which the proceeds from investment is proposed to be utilised by the
recipient |
Date of Board/ Management Committee resolution |
Date of special resolution |
Expected rate of return |
| 1 |
28.03.2019 |
Daawat Foods Limited |
2,000.00 |
Business Purpose |
06.03.2019 |
N.A. |
N.A. |
| 2 |
18.10.2018 |
Daawat Kameda India Private Limited |
2,234.79 |
Business Purpose |
09.10.2018 |
N.A. |
N.A. |
| Details of Guarantee/Security Provided: |
|
|
| Details of recipient |
Amount |
Purpose for which the security/guarantee is proposed to be utilised by the
recipient |
|
(` In lakhs) |
|
| 1 Daawat Foods Limited |
21,938.48 |
Working capital loan |
| 2 Nature Bio Foods Limited |
8,746.91 |
-do- |
| 3 Raghunath Agro Industries Private Limited |
5,038.18 |
-do- |
| 4 LT Foods Europe BV |
13,442.52 |
Working capital loan |
28. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The particulars of every contract or arrangements entered into by the Company, with
related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013,
are disclosed in Form No. AOC-2. With reference to Section 134(3) (h) of Companies Act,
2013, all contracts and arrangements with related parties entered into by the Company,
under Section 188(1) during the financial year are in ordinary course of business and on
arms length basis.
29. CORPORATE GOVERNANCE CERTIFICATE
The Report on Corporate Governance as stipulated under Regulation 34(3), read with Para
C of Schedule V of the Listing Regulations, is presented in a separate section forming
part of this Annual Report.
A certificate from the practicing Company Secretary (CS), Debasis Dixit, regarding
compliance with the conditions of corporate governance as stipulated in Regulation 27 of
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements),
Regulations, 2015, is annexed to the Report.
30. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report, prepared in accordance with the
Regulation 34(2)(e) of Listing Regulations, forms part of this Annual Report for the year
ended March 31, 2019.
31. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013.
In order to prevent sexual harassment of women at workplace, the implementation of the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
has been notified on December 09, 2013. Under the said Act, every Company is required to
set up an Internal Complaints Committee to look into the complaints relating to sexual
harassment at workplace of any women employee.
The Company has adopted a policy for prevention of sexual harassment of women at
workplace and has set up Committee for implementation of the said policy. During the year,
the Company has received one compliant which was duly resolved and the report on the same
was filed with District office/ Chairperson, District Complaints Cell Committee, Vikas
Sadan, Gurugram.
32. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND
OUTGO
The details of conservation of energy, technology absorption, foreign exchange earnings
and outgo are as follows:
A. Conservation of Energy
The Company continued to place major emphasis on energy conservation and the measures
taken during the previous year were continued. The efficiency of energy utilisation is
being monitored in every quarter in order to achieve effective conservation of energy.
LT Foods has taken several initiatives towards this direction and have been working
both towards energy conservation and new technology absorption.
Energy Conservation
1. Reduction of line losses – With effective power factor control methods, we were
able to reduce line losses by a significant amount
2. Efficiency improvement of motors – We were able to reduce failure rates of
motors, thereby bringing down power consumption which gets increased due to repair. Also
some inefficient motors were declared obsolete and replaced
3. All street/tower lights were replaced with LED lights to reduce energy consumption,
alongside optimising lights
4. Modification in some compressed air lines done which led to improved efficiency of
compressors
Technology Absorption
1. All new lightning and some AC provided through timers to minimise energy consumption
2. Process automation was upgraded at Sella Plant to provide better quality as well as
productivity
3. New, state-of-the-art warehouse has been set up at Bahalgarh with hi-tech solutions
for seamless operations and digital proficiencies
Power and fuel consumption (Bahalgarh plant)
|
|
(` In lakhs) |
| Particulars |
March 31, 2019 |
March 31, 2018 |
| ELECTRICITY |
|
|
| Through Purchases |
|
|
| Units |
21,232,165 |
16,482,612 |
| Total Amount (`) |
1,746.77 |
1,318.30 |
| Rate/Unit(` ) |
8.23 |
8.00 |
| Through Diesel Generator |
|
|
| Units generated |
610,449 |
630,733 |
| TOTAL AMOUNT |
132.98 |
109.94 |
| Cost/Unit (`) |
21.78 |
17.43 |
| Power and fuel consumption (Varpal plant) |
|
(` In lakhs) |
| Particulars |
March 31, 2019 |
March 31, 2018 |
| ELECTRICITY |
|
|
| Through Purchases |
|
|
| Units |
4,520,910 |
4,825,700 |
| Total Amount (`) |
307.23 |
332.33 |
| Rate/Unit (`) |
6.80 |
6.89 |
| Through Diesel Generator |
|
|
| Units generated |
73,000 |
73,400 |
| TOTAL AMOUNT |
18.47 |
12.52 |
| Cost/Unit (`) |
25.30 |
17.06 |
(b) Technology, Absorption, Adaption and Innovation
Technology is changing day by day. Over the years, the Company has taken significant
steps in adoption of new technologies, thus improving overall efficiency of plants.
Similar steps were taken in the year under review as well by replacing the lower capacity
machines with the new, higher capacity machines. Some such machines include the color
sorters which is one of the critical machines involved in the rice processing industry.
Some of the old, lower capacity colour sorters, were replaced with new, upgraded and high
capacity machines resulting in reduction of rejection percentage, improvement in final
output and increasing overall efficiency.
The Company has realised and agrees that continuous improvement can be achieved only if
the employees involved in the process directly or indirectly are highly trained on modern
techniques and are aware of global standards. One such step taken by the Company in that
direction is to start the Manufacturing Excellence and Improvement Programme. The key
highlights of this improvement drive were – 5S, Maintenance Improvement Techniques,
Reliability Matrix, MTTR & MTBF etc. and so on, which are highly beneficial and
globally accepted programmes for process improvement.
(c) Foreign exchange earnings and outgo
During the year, the total foreign exchange spend was ` 2,270.56 lakhs and the total
foreign exchange earned was ` 88,776.79 lakhs.
|
|
(` In lakhs) |
| Particulars |
March 31, 2019 |
March 31, 2018 |
| Value of Imports on CIF basis |
|
|
| Capital Goods |
608.24 |
852.19 |
| Stores and Spares |
174.92 |
37.00 |
| Other Food Items |
- |
- |
| Other |
8.01 |
- |
| Total |
791.17 |
889.19 |
| Expenditure in |
|
|
| Foreign Currency |
|
|
| Legal Fees |
142.83 |
177.60 |
| Interest and other charges to bank |
766.22 |
807.78 |
| Steamer Freight |
1,131.41 |
901.17 |
| Sales Promotion |
76.29 |
113.89 |
| Commission on Export Sales |
34.05 |
26.21 |
| Others |
119.75 |
662.16 |
| Total |
2,270.56 |
2,688.80 |
| Earnings in Foreign Currency |
|
|
| FOB Value of Exports |
|
|
| Rice |
88,776.79 |
86,409.73 |
| Total |
88,776.79 |
86,409.73 |
33. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The disclosures as per Rule 9 of the Companies (Corporate Social Responsibility Policy)
Rules, 2014 related to CSR activities is detailed in Annexure II.
34. HUMAN RESOURCES
The Company treats its 'human resources' as one of its most important assets.
The Company continuously invests in attraction, retention and development of talent. A
number of programmes that provide focused people attention are currently underway. The
Company's thrust is on the promotion of talent internally through job rotation and job
enlargement. The Company also maintains healthy, cordial and harmonious industrial
relations at all levels. The enthusiasm of employees have enabled the Company to maintain
its leadership position in the industry.
35. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section-134(3)(C) of the Companies Act, 2013, based on the representations
received from the operating management and after due inquiry, the Directors confirm that:
(a) In the preparation of the annual accounts, the applicable accounting standards have
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 and loss of the Company for that period
(c) The Directors have taken proper and sufficient care of 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
(e) The Directors have laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and operating effectively
(f) The Directors have devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems are adequate and operating effectively.
36. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to Sections 124 and 125 of the Companies Act, 2013, the dividend which remains
unpaid/unclaimed for a period of seven years from the date of transfer to unpaid dividend
account is required to be transferred to the Investor Education and Protection Fund (IEPF)
established by the Central Government. Accordingly, the Company transferred unclaimed
dividend of ` 194,740/- for FY 2010-11 to Investor Education and Protection Fund and such
unclaimed dividend cannot be claimed by the Investors from the Company. However, Investors
can claim the unpaid dividend from appropriate authority in accordance with the Investor
Education and Protection Fund Authority (Accounting, audit, transfer and refund) Rules,
2016.
Pursuant to the provisions of Section 124(6) of the Companies Act, 2013, read with Rule
6 of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and
Refund) Rules, 2016, (as amended from time to time) the Company in the previous year
2018-19 has transferred 41,680 equity shares, which belongs to the shareholders whose
dividend was not paid or claimed for seven consecutive years or more, to the demat account
of IEPF Authority.
Additionally, the amount of dividend unclaimed/unpaid for FY 2011-12 to 2017-18 lies in
the respective unpaid dividend account and can be claimed from the Company's Registrar and
Transfer Agent i.e. Big Share Services Private Limited, before the due date for transfer
of the same in IEPF account.
Pursuant to the provisions of the Investor Education Protection Fund (Uploading of
information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the
Company uploaded the details of unpaid and unclaimed amounts lying with the Company, as on
September 24, 2018, with the Ministry of Corporate Affairs.
37. LISTING WITH STOCK EXCHANGES
The Company confirms that it paid the Annual Listing fees for FY 2018-19 to NSE and BSE
where the Company's shares are listed.
38. COMPLIANCE WITH SECRETARIAL STANDARDS
The Company duly followed the applicable secretarial standards, SS-1 and SS-2 relating
to meeting of the Board of Directors and General Meeting, respectively.
39. ACKNOWLEDGEMENTS
The Company's Directors place on record their gratitude to all Stakeholders for their
assistance, cooperation and encouragement. The Directors also wish to place on record
their sincere thanks to all stakeholders for their outstanding performance.
| For and on behalf of the Board of Directors |
|
|
Sd/- |
|
Vijay Kumar Arora |
| Place: Gurugram |
Chairman & Managing Director |
| Date: August 08, 2019 |
DIN:00012203 |
| ANNEXURE INDEX |
| Annexure Content |
| I. Annual Return Extracts in MGT 9 |
| II. Report on Corporate Social Responsibility |
| III. AOC 2 – Related Party Transactions disclosure |
| IV. MR-3 Secretarial Audit Report |
| V. Details of subsidiaries and Joint Venture in AOC-1 |
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