K P R Mill Ltd
Directors Reports
Dear Members,
The Board of Directors takes pleasure in presenting the report on the
operations and business of the Company along with Audited Financial
Statements for the Financial Year ended 31 March, 2023.
FINANCIAL RESULTS
(Rs in Lakhs)
Particulars |
Standalone |
Consolidated |
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Sales and Other Income:- |
|
|
|
|
| Domestic Sales |
2,85,579 |
2,42,442 |
3,69,601 |
2,95,811 |
| Export Sales |
1,71,502 |
1,52,427 |
2,26,417 |
1,71,667 |
| Other Income |
29,886 |
20,961 |
28,802 |
23,492 |
|
4,86,967 |
4,15,830 |
6,24,820 |
4,90,970 |
Pro t before Interest & Depreciation |
92,909 |
1,06,853 |
1,33,671 |
1,30,593 |
| Less : Interest |
2,670 |
1,339 |
7,886 |
2,329 |
| Depreciation |
7,764 |
7,565 |
17,369 |
14,112 |
Pro t Before Tax |
82,475 |
97,949 |
1,08,416 |
1,14,152 |
| Less : Taxation:- |
|
|
|
|
| Provision for Current Tax |
18,324 |
24,870 |
25,273 |
29,706 |
| Tax relating to earlier years |
(802) |
(75) |
(982) |
(53) |
|
17,522 |
24,795 |
24,291 |
29,653 |
| Deferred Tax expense / Credit |
1,449 |
74 |
2,715 |
315 |
| Pro t After Tax |
63,504 |
73,080 |
81,410 |
84,184 |
| Other Comprehensive Income (Net of tax) |
- |
- |
- |
- |
Total Comprehensive Income |
63,504 |
73,080 |
81,410 |
84,184 |
REVIEW OF OPERATIONS
The year began with a positive note of robust growth and pro tability.
But the steep increase in cotton prices at all time high level coupled with lower yarn
price realisation has trimmed the cotton-yarn spreads. However, the supportive trends in
garment segment enabled better performance, overcoming these challenges. The wind power
generation during the year was good. Despite the adverse factors like Global recession,
Ukraine war, huge volatility in cotton prices, high in ation etc., the inherent strengths
enabled KPR repeating a better performance during the year also.
WAY FORWARD
The cotton prices have started stabilising and the garment order
position continues to be encouraging. The Indian textile industry is optimistic of
retaining the growth level with the supportive Government policies, FTAs with significant
markets that are likely to create more market opportunities for entire textile value
chain. To improve its performance further, KPR has contemplated certain modernisation and
expansion plans.
EXPANSION
During the year, we have installed 10 MW rooftop Solar Power plant
whose benefit can be derived from the current year, upon receipt of the approval from
TANGEDCO.
The Company also have plans to establish separate Spinning Mill for
Viscose Yarn production, besides expanding Ethanol production capacity through our Wholly
Owned Subsidiary Companies. Considering the developments in the textile market further
plans may be decided by the Board at appropriate time.
BRANDED RETAIL BUSINESS
FASO
Consumers' increasing focus on sustainability and ethical
production has added significance to our FASO products, which are organic centric.
Enthused by the response to various styles in Men's wear, we have introduced
Women's wear also in October 2022, which is also well received in the Market.
Consequent on better handling of the pandemic by Indian Authorities over the years, its
impact started receding that enabled resurgence of our efforts towards
‘Pan-India' spread. In addition to the Southern States, we have already launched
FASO products in some of the States of commercial importance and planning to add more such
States in the current year.
DIVIDEND
Considering better performance and strong liquidity during the year,
the Board of Directors have declared an Interim Dividend @ 200% on equity shares (Rs 2 per
Equity Share) at their meeting held on 06.02.2023. The Board in its meeting held on
03.05.2023 also has recommended a Final Dividend of 200% (Rs 2 per Equity Share) on Equity
Shares, thus aggregating to 400 % (Rs 4 per Share on Equity Share of Face Value of Rs 1
each), for the Financial Year 2022-23, subject to the approval of the Members of the
Company at the 20 (Twentieth) Annual General Meeting.
FINANCE
Consequent to the expansion of Garment & Sugar business and the
availment of additional Working Capital, the nance charges has gone up over previous year.
However, led by the successful financial planning comfortable financial position continued
during the year also. Some of the term loans availed for the new garment project were
repaid and fresh term loan from Banks was availed towards the expansion of Ethanol project
in our wholly owned Subsidiary Company.
SUBSIDIARY COMPANIES
The statements pursuant to Section 129(3) of the Companies Act, 2013
(Hereinafter referred to as the 'Act') in ‘Form AOC - 1‘ containing the details
of following Wholly Owned Subsidiary Companies forms part of this Annual Report. However
as required by the 'Act', we give below a brief report on their performance.
I. K.P.R. Sugar Mill Limited
II. KPR Sugar and Apparels Limited
III. Jahnvi Motor Private Limited
IV. Quantum Knits Pvt. Limited
V. Galaxy Knits Limited
VI. KPR Exports Plc
VII. KPR Mill Pte. Ltd.
SUGAR
The year under review was a successful year for the Indian Sugar
industry and is on track for steady growth in the current year too. Though the acreage
remains the same, the yield was better due to crop variety, better farming practices, etc.
With the Government's continuous support towards the sugar sector and increasing
focus on diversion towards ethanol production to promote Ethanol Blending Program in
India, the sugar sector is likely to gain traction going forward.
ETHANOL
Encouraged by the success of achieving the target of 10 percent Ethanol
blending in petrol, much ahead of the target date, the
Government advanced the target of 20 percent ethanol blending to the
year 2025 (earlier 2030). To increase revenue we are planning to expand Ethanol production
capacity.
K.P.R. SUGAR MILL LIMITED
The sugarcane crushing for sugar season 2022-23 commenced in October
2022, produced 1,22,730 MT of Sugar. The Co-gen plant produced 1437.38 lakhs units of
Power. Out of the same, 796.21 lakhs units were sold and 641.17 lakh units were captively
consumed. During the year 38,936.42 KL of Ethanol was produced, using Sugar Syrup and
Molasses and the entire production was sold to Oil Marketing Companies. The expansion plan
to increase Ethanol production capacity from 90 KLPD to 240 KLPD with Zero Liquid
Discharge System is in progress.
During the year, an Interim Dividend of Rs 130/- on the Equity shares
of Face Value of Rs 10/- each was declared by its Board in its meeting held on 06.02.2023.
KPR SUGAR AND APPARELS LIMITED
Ramping up of production in the new 42 million Garments capacity at
Chengapally, Tirupur district, Tamil Nadu has been completed and is successfully executing
the orders from International Buyers.
The sugarcane crushing for sugar season 2022-23 commenced in November
2022, produced 98,565 MT of Sugar. The Co-gen plant produced 1,468.85 lakhs units of
power. Out of the same, 900.34 lakhs units were sold and 568.51 lakh units were captively
consumed. During the year 29,866 KL of Ethanol was produced, using Sugar Syrup and
Molasses and the entire production was sold to Oil Marketing Companies.
JAHNVI MOTOR PRIVATE LIMITED
During the year, the Company could sell 156 Audi Cars and earned a
total revenue of Rs 113.91 Crores. Steady economic growth amid signs of moderating in
ation, coupled with strong earnings, is fueling the demand at the higher end of the market
and supporting sales of luxury vehicles. Local demand continues to be strong.
QUANTUM KNITS PVT. LIMITED
During the year, an Interim Dividend of Rs 1500/- on the Equity shares
of Face Value of Rs 10/- each out of accumulated reserves was declared by its Board in its
meeting held on 06.02.2023.
GALAXY KNITS LIMITED
The Company has not yet commenced its operation.
K P R EXPORTS PLC (ETHIOPIA)
As informed in the earlier report, we have already approached the
Ethiopian Authorities seeking their assistance to formally close the Apparel manufacturing
unit at Ethiopia due to civil disturbance and to bring back capital materials therein. The
same is being followed up.
KPR MILL PTE. LTD ( SINGAPORE )
The Company was established primarily for the purpose of marketing the
products manufactured at Ethiopia. However, considering the changed business environment
therein and the growing International trade at our Company, the Management is planning to
utilise the services of this Company for its future business plans.
DEPOSITS
The Company has not accepted any deposits from public during the year
under review.
DIRECTORS
Mr. K.N.V. Ramani, Independent Director passed away on 30.03.2023.
Taking note of his long association and sane advice, the Board placed on record the
invaluable services rendered by him as Lead Independent Director and Corporate Lawyer.
The Board of Directors, at its meeting held on May 03, 2023, based on
the recommendation of the Nomination & Remuneration Committee appointed Mrs V.
Bhuvaneshwari (DIN: 01628512) as an Additional Director (Non-Executive & Independent)
to hold officetill the conclusion of the ensuing Annual General Meeting and subject to the
approval of the members in the said Annual General Meeting appointed as ‘Woman
Independent Director' of the Company to hold officefor a term upto 5 consecutive
years. To regularize her appointment in the 20 Annual General Meeting (AGM) of the
Company, suitable resolution is included in the notice of AGM proposing her appointment.
Pursuant to the provisions of Rule 6 of the Companies (Appointment and
Qualifications of Directors) Rules, 2014, Mrs.V.Bhuvaneshwari (DIN: 01628512) had passed
the online pro ciency self-assessment test conducted by the ‘Indian Institute of
Corporate A airs'.
The Company has adequate Independent Directors in compliance with the
Act and SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2015
(Hereinafter referred to as Listing Regulations). Familiarization Program on the Company
and its operation was conducted for the Independent Directors. Requisite declaration from
the Independent Directors of the Company under Section 149 (7) of the Act confirming that
they meet with the criteria of their Independence laid in Section 149 (6) have been
obtained.
Mr.C.R.Anandakrishnan, Executive Director, retires by rotation at the
ensuing Annual General Meeting and is eligible for re-appointment.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act the Company has Key Managerial Personnel. None
of the Managing Directors or Whole Time Directors receives any remuneration or commission
from the Subsidiary Companies and the remuneration paid to them is within the purview of
the provisions of Section 197 of the Act. The Company pays remuneration by way of salary,
perquisites, commission etc., to its Chairman, Managing Directors and xed monthly
remuneration to its Executive Directors and Whole Time Director in line with the approvals
accorded by the General Meetings and in pursuance of the recommendation of the Nomination
and Remuneration Committee as per the guiding principles laid down in the Nomination and
Remuneration Policy. The information as required by Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is appended.
ANNUAL PERFORMANCE EVALUATION
In line with the criteria evolved by the Nomination and Remuneration
Committee, the performance of all Directors, Committees, Chairman etc., have been
evaluated pursuant to the provisions of the Act and the Listing Regulations.
COMMITTEES
As required by the provisions of the Act and Listing Regulations, the
Company has already formed the following Committees, the details of which are disclosed in
the Report on Corporate Governance forming part of this Report.
I. Audit Committee
II. Stakeholders Relationship Committee
III. Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
V. Risk Management Committee
POLICIES
In pursuance of the Act and the Listing Regulation, the following
policies have been framed and disclosed on the Company's website www.kprmilllimited.com
I. Nomination & Remuneration Policy
II. Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
VII. Risk Management Policy
VIII.Dividend Distribution Policy The Web-link -
https://kprmilllimited.com/ le/wp-content/uploads/2018/11/DD-Policy.pdf
IX. Policy for Disclosure of Material Events / Information
X. Policy on Succession Planning for Board and Senior Management
RISK MANAGEMENT
Pursuant to section 134(3) (n) of the Act & Regulation 17(9) of the
Listing Regulation, the Company has a Risk Management Policy and has constituted a Risk
Management Committee. The Risk Management Committee held its meetings on 29.06.2022 and
19.12.2022 in which all members were present.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has an established Vigil Mechanism for Directors and
Employees to report concerns about unethical behaviors, actual or suspected fraud or
violation of the code of conduct or ethics policy. It also provides for adequate
safeguards against victimization of Directors/Employees who avail of the mechanism. The
Company a rms that no personnel have been denied access to the Audit Committee. The
Company has a Policy of Vigil Mechanism and has established a mechanism that any personnel
may raise reportable matters. All suspected violations and reportable matters can be
reported to the Chairman of the Audit Committee at e-mail id whistleblower@kprmill.com The
key directions/ actions can be informed to the Chairman/ Managing Director of the Company.
The Whistle Blower Policy has been reviewed by the Board of Directors and displayed in the
Company's website.
CSR EXPENDITURE
During the year, in pursuance of the recommendations of the CSR
committee the Company has contributed Rs 6307.89 Lakhs towards implementing the CSR
activities including an advance contribution of Rs 5017.30 lakhs which is equal to 3
Years' estimated CSR contribution to be set-off against subsequent years' CSR
obligation. Annual Report on CSR, as required by the Act, is appended.
BOARD MEETINGS
The Board of Directors met Four times during the financial year on
27.04.2022, 28.07.2022, 07.11.2022 and 06.02.2023 through physical mode. The Composition
of Board, procedure, venue, dates, time and other details are included in the Corporate
Governance Report that forms part of this Report.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in annexing the Consolidated Financial
Statements pursuant to the provisions of the 'Act' and the Listing Regulations entered
into with the Stock Exchanges. They are prepared in accordance with the Ind-AS prescribed
by the Institute of Chartered Accountants of India, in this regard. The Consolidated
Financials also marked a significant increase in its Revenue as well as Pro tability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the
Act and as required therein the details of the Borrowals, Security, Investment etc., are
annexed by way of notes to accounts.
RELATED PARTY TRANSACTIONS
All Related Party Transactions that were entered into during the
financial year were only between Holding Company and Wholly owned Subsidiary Companies in
the ordinary course of business, whose accounts are consolidated with Holding Company and
placed before the shareholders at the General Meeting for approval. However, as per
regulatory requirements an omnibus approval of the audit committee for such transactions
has been obtained.
The Transactions as required under Indian Accounting Standards
‘Ind AS-24' are reported in Note 40 of the Notes to Accounts of the Standalone
Financial Statements as well as Note 40 of the Notes to Accounts of the Consolidated
Financial Statements of your Company. The Company's Policy on dealing with related party
transactions is available on the Company's website.
EMPLOYEE WELFARE
India has a large working population, a prominent asset in the
labour-intensive textiles sector particularly in Garment industry. They are crucial
stakeholders playing an integral role in the success of an organisation. KPR continuously
takes concrete steps to promote the wellbeing of work force at work and good work-life
balance. One of the significant efforts towards the same is provision of Higher Education
facility. Employees who receive higher education tend to have improved sense of self-worth
with more opportunities to grow besides contributing to the success of the Organisation.
Our unique Career development process for the employees based on their educational
qualification also continues.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of
the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in
respect of Employees of the Company, will be provided upon request. In terms of Section
136 of the Act, the reports and accounts are being sent to the members and others entitled
thereto, excluding the information on employees' particulars which is available for
inspection by the members at the Registered O ce of the Company during business hours on
working days of the Company upto the date of ensuing Annual General Meeting. If any member
is interested in inspecting the same, such member may write to the Company Secretary in
advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 provides for protection against sexual harassment of women at
workplace and for the prevention and redressal of complaints of sexual harassment and also
for the matters incidental thereto. The Company has accordingly adopted the policy against
Sexual Harassment of Women at Workplace, for the purpose of preventing, prohibiting and
redressing sexual harassment of female employees at all the workplace within the Company
which are based on fundamental principles of justice and fair play.
According to the noti cations of corporate affairs ministry dated 31
July 2018, Internal Complaints Committee under the sexual harassment of women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013, has been formed and complied with.
Further, Anti Sexual Harassment Committee has been constituted at each unit which shall be
responsible for redressal of complaints related to sexual harassment. The details of all
such Complaints and its proper redressal through prompt corrective steps are informed to
the Top Management so as to ensure that suitable processes and mechanisms are put in place
to ensure that issues of sexual harassment, if any, are effectively addressed. During the
year, no complaints of sexual harassment were received by the Company from any of its
Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under the Act read with
the Companies (Accounts) Rules, 2014 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Act, the Board
of Directors of the Company hereby state and con rm that;
I. In the preparation of the Annual Accounts, the applicable accounting
standards have been followed along with proper explanation relating to material
departures.
II. The Directors have selected 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 a airs of the Company at the end of the
financial year and of the profit of the Company for the year under review.
III. The Directors have taken proper and sufficient care for the
maintenance of adequate record in accordance with the provisions of the Companies Act,
2013, for safeguarding the assets of the Company and for preventing and detecting fraud
and other irregularities.
IV. The Directors have arranged preparation of the accounts for the
financial year ended 31.03.2023 on a going concern basis.
V. The Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are adequate and were
operating effectively.
VI. The Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were adequate and operating
effectively.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
REPORT
Corporate Governance Report and Management Discussion and Analysis
Report are attached to this Report. Certificate from the Statutory Auditors of the Company
confirming the compliance with the conditions of Corporate Governance as stipulated under
Schedule V of the Listing Regulation is also attached to this report.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
In pursuance of Regulation 34(2)(f) of the Listing Regulations, the
Business Responsibility and Sustainability Report, containing the initiatives taken by the
company from environmental, social and governance perspective, forms part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. The details of internal financial control and
their adequacy are included in the Report of Management Discussion & Analysis, which
forms part of this report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the
median employee's remuneration as required by the Act and Companies Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that
have any impact on the going concern status and the operations of the Company.
DETAILS REGARDING ISSUE OF SHARES
During the year under review the Company has not issued any shares.
BUYBACK
The Buyback of 22,36,000 Equity Shares mooted during the FY 2021-22 was
completed on 26 April 2022. The present Paid up Capital post Buyback is 34.18 Crores.
AUDITORS
In the 19 Annual General Meeting of the Company held on 23.08.2022 M/s.
B S R & Co LLP, Chartered Accountants (ICAI Firm Regn. No.101248W/W-100022) were
re-appointed as Statutory Auditors of the Company for second term of ve consecutive years
from the Financial Year 2022-23.
AUDITORS REPORT
The Auditor's Report to the Shareholders does not contain any
quali cation. There were no frauds reported by the Statutory Auditors under provisions of
Section 143 (12) of the Companies Act, 2013 and rules made thereunder.
COST RECORDS
Pursuant to Section 148 of the Act, the company falls under the limits
specified under this section and hence the company has maintained proper books of accounts
with all the particulars relating to the utilization of material, labour and to other
items of cost.
COST AUDIT
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the
Company has appointed a Cost Auditor for the Company to audit the cost records for the
Financial Year 2022-23.
SECRETARIAL AUDIT REPORT & CERTIFICATES AND SECRETARIAL STANDARDS
COMPLIANCE
The Company has complied with the applicable Secretarial Standards
issued by ICSI. As required by the Act a Secretarial Audit Report issued by a Company
Secretary in practice (PCS) a Peer Reviewed Unit in Form MR 3 is annexed with this report
and it does not contain any quali cation. Certificate from PCS that none of the Directors
are debarred or disqualified forms part of this Annual Report. Annual Secretarial
Compliance Report certifying compliance of SEBI Regulations has been obtained and led with
the Stock Exchanges.
ANNUAL RETURN
Pursuant to section 92 of the Act and Rule 12 of the Companies
(Management and Administration) Rules, 2014, the Annual Return in the prescribed form is
available on the Company's website: https://kprmilllimited.com/
nancial-result_annual-reports/
DETAILS OF DEMAT/UNCLAIMED SUSPENSE ACCOUNT
The status of unclaimed shares of the Company transferred to the demat
account, ‘K.P.R. Mill Limited - Unclaimed Shares Demat Suspense Account', in
accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015, is as follows:
Particulars |
No. of Shareholders |
No. of Shares |
Aggregate number of
shareholders and the outstanding shares in the suspense account lying at the beginning of
the year |
2 |
2750 |
Number of shareholders who
approached listed entity for transfer of shares from suspense account during the year |
- |
- |
Number of shareholders to whom
shares were transferred from suspense account during the year |
- |
- |
Aggregate number of
shareholders and the outstanding shares in the suspense account lying at the end of the
year |
2 |
2750 |
The Voting rights in respect of these shares will remain frozen till
the time such shares are transferred from the Unclaimed Suspense Account to the concerned
Shareholders.
MATERIAL CHANGES AND COMMITMENTS
No material changes and commitments affecting the financial position of
the Company occurred between the end of the financial year as on 31.03.2023 and the date
of this Report.
NO CHANGES IN THE BUSINESS
Your Directors would like to inform that Company is doing its regular
business and there has been no change in its objectives.
GENERAL
Disclosures under sub rule 5 (xi) and (xii) of rule 8 of Companies
(Accounts) Rules, 2014 are not applicable to the Company.
ACKNOWLEDGEMENT
Your Directors acknowledge with gratitude and express their
appreciation for the assistances and co-operation received from the Bankers, Government
Authorities, Customers, Vendors, and Members during the year under review. Your Directors
also wish to thank the employees at all levels for their co-operation and dedication.
FOR AND ON BEHALF OF THE BOARD
| Coimbatore |
K.P. Ramasamy |
| 03.05.2023 |
Chairman |
|
DIN: 00003736 |
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