About
Pidilite Industries Ltd
Pidilite Industries Limited (PIL) was incorporated on 28th July, 1969 as a consumer and specialities chemical company. The Company is the market leader in adhesives and sealants, construction chemicals, hobby colours and polymer emulsions in India. Its brand name Fevicol has become synonymous with adhesives to millions in India and is ranked amongst the most trusted brands in India. The company's product range includes Adhesives and Sealants, construction chemicals, craftsmen products, polymer emulsions, paint chemicals, automotive chemicals, art materials and stationery, fabric care, maintenance chemicals, industrial adhesives, industrial, textile resins and organic pigments and preparations. Some of the company's major brands are M-Seal, Fevikwik, Fevistik, Roff, Dr. Fixit, Fevicryl, Motomax and Hobby Ideas.
Pidilite was the first company in India, which started production of violet pigment in the year 1973. In 1984, the company's consumer product division was born and in 1989 the company entered fevicryl acrylic colours transform fabric and multi-surface painting market. The Company made its maiden public offering of equity shares in the year 1993. During the year 1995, plants of the company in Mumbai and Vapi acquired an ISO 9001 certification. Also the plant at Mahad received an ISO 9002 certification in the same year. Fevicol, the premier brand of the company ranked among the Top 15 Indian brands by FE Brandwagon Year Book 1997. After two years, in 1999, Pidilite had acquired 'Ranipal', leading brand of optical whitener and subsequently acquired 'M-Seal', leading brand of epoxy compounds in the year of 2000. In the identical year of 2000 itself, Fevicol campaign won the Silver ABBY for the Campaign of the Century in India. The Company had launched Dr. Fixit range of Construction Chemicals in the year 2001 and had acquired 'Steelgrip', leading brand of PVC insulation tape in India during the year 2002. Pidilite had again acquired the Roff' brand of Construction Chemicals in the year of 2004.
A wholly-owned subsidiary in Singapore, under the banner 'Pidilite International Pte Ltd was incorporated by the company in the year 2005 for its international operations, encompassing the acquisition of overseas companies and joint ventures. Also in the same year 2005, Pidilite had acquired Chemson Asia Pte Ltd, an existing Singapore-based company in the business of manufacturing waterproof coating and emulsion paints, thereby adding to its existing, and rapidly-growing construction chemicals and paints range and the company had took over Jupiter Chemicals in Dubai. During the identical year of 2005, the company had incorporated a subsidiary, namely 'Pidilite Do Brasil Desenvolvimento De Negocios Ltd', in Sao Paulo, Brazil and 'Pidilite Middle East Limited', as an offshore company in the Jebel Ali Free Zone of Dubai.
During the year 2006, Pidilite had acquired Tristar Colman brand and business, Tristar Fine Art, a market leader in brushes for drawing and painting and Bamco Thailand, a Construction Chemical company. Also Pidilite had acquired the business and assets of Sargent Art Inc through a subsidiary Pidilite USA Inc, Delaware. The Company had established its R&D centre in Singapore under the banner 'Pidilite Innovation Centre Pte Ltd.' Pidilite had de-merged VAM manufacturing unit at Mahad of Vinyl Chemicals (India) Ltd into the company with effect from 1st April of the year 2007. During 2007-08, Fevicol 1K PUR and Fevicol Kwikgrab were introduced by the company to take care of special applications in building construction segment. Pidilite with its wholly-owned subsidiaries had acquired assets and business of branded sealants and adhesives from Hardcastle & Waud Manufacturing Co. Ltd and associates. The Company had acquired Bhimad Commercial Co. and Madhumala Traders by investing Rs 170,000 each in February of the year 2008. Fevicol has been ranked No. 1 in Household Care Segment in June 2008.
The Board of Directors of Pidilite Industries at its meeting held on 10 June 2013 decided to explore induction of a strategic partner for the Synthetic Elastomer Project.
On 22 September 2014, Pidilite Industries announced that its Board of Directors has approved the acquisition of the adhesive business of Blue Coat Private Limited on a slump sale basis for a cash consideration of Rs 263.57 crore.
On 12 December 2014, Pidilite Industries announced that the company along with its wholly owned subsidiary Pidilite International Pte Ltd. has incorporated a private limited subsidiary company in Ethiopia on 10 December 2014 in the name of Pidilite Chemical PLC for manufacture of adhesives, mastics, paints, varnishes or similar coatings, printing, writing and painting inks etc.
The Board of Directors of Pidilite Industries at its meeting held on 30 March 2015 approved investment in equity shares of Nina Waterproofing Systems Private Limited. The proposed shareholding of the company in Nina will be 70%, thereby making Nina a subsidiary of the company. The initial investment of Pidilite Industries in Nina will be about Rs 23.33 lakh. The Board has also approved additional investment up to Rs 100 crore in Nina.
On 16 April 2015, Pidilite Industries announced that its subsidiary Nina Waterproofing Systems Private Ltd. (NWSP) has acquired the waterproofing business of Nina Concrete Systems Private Ltd. (NCS) on a slump sale basis. PIL holds 70% of the paid up capital in NWSP. The waterproofing business under the brand name NINA was established in 1965. NINA is recognized as one of the leading waterproofing solution contractors in India. NINA has its major presence across the construction spectrum including residential, commercial, industrial, institutional and infrastructure segments.
On 25 November 2015, Pidilite Industries announced that the company along with its wholly owned subsidiary Fevicol Company Limited has on 20 November 2015 incorporated a company in the name of Wood Coat Private Limited to be engaged in all types of coatings for wood including wood stains, fillers, primers, wood finish etc.
On 30 November 2015, Pidilite Industries announced that Pidilite Lanka (Private) Limited, a step down subsidiary of the company incorporated in Sri Lanka, has acquired from CIC Holdings PLC, the Chemifix trade mark and other brands associated with PVAC Adhesives business along with the commercial and technical knowhow relating to PVAC Adhesive business. CIC Holdings PLC is a large conglomerate in Sri Lanka and is involved in number of segment in Sri Lanka such as chemicals, fertilizers, pharmaceuticals, agri chemical, food products etc.
On 25 April 2016, Pidilite Industries announced that its Board of Directors has approved execution of definitive agreements with INDUSTRIA CHIMICA ADRIATICA SPA (ICA), a leading wood finish manufacturer based in Italy. As part of the joint venture, Pidilite Industries along with its wholly owned subsidiary Fevicol Company Limited, will hold 50% of the shareholding in Wood Coat Private Limited (the joint venture company) and the remaining 50% of the shareholding will be held by ICA and Italcoats, a partnership firm and distributor of ICA wood finishes in India. The joint venture company will initially engage in high technology wood finish business in India and other select countries. Wood Coat Private Limited is currently a wholly owned subsidiary of Pidilite Industries.
The joint venture company will acquire the current wood finish distribution business of Italcoats and will be exclusive distributor of ICA wood finishes in India and other select countries. The joint venture company will also acquire technology and knowhow for manufacture of select wood finish products from ICA and shall be entitled to manufacture ICA wood finishes for marketing, distribution and sales in India and other select countries. Pidilite Industries' Board of Directors has approved an equity investment of up to Rs 63.75 crore on or before 15 May 2016 and a further equity investment of up to Rs 62.50 crore in accordance with the business requirements of the joint venture company.
On 16 June 2016, Pidilite Industries informed stock exchanges that its two wholly owned subsidiaries Pidilite International Pte. Ltd and Pidilite Middle East Ltd, have acquired shares of Nebula East Africa Private Limited (NEAPL), a company incorporated in Kenya. With this acquisition, the wholly owned subsidiaries of the company hold 100% of the paid up share capital (which is Kenyan Shillings 100,000) equivalent to approximately USD 1000 in NEAPL. NEAPL is proposed to be engaged in the business as manufacturers, importers, exporters, buyers, sellers etc. in adhesives, sealants, and all other products used for making or producing adhesives and sealants.
The Board of Directors of Pidilite Industries at its meeting held on 26 December 2017 approved buyback proposal for purchase by the company of its own fully paid up equity shares of Re 1 each not exceeding 50 lakh equity shares (being 0.975% of the total paid up equity capital of the company) at a price of Rs 1000 per share for an aggregate amount of up to Rs 500 crore. The proposed buyback will be through the tender offer route.
On 9 February 2018, Pidilite Industries announced that it has completed the acquisition of 70% equity shares of CIPY Polyurethanes Pvt. Ltd. CIPY is engaged in the business of manufacture and sale of floor coatings using polyurethanes, epoxies, polyurea and polyaspartic polymers. CIPY is one of the well-known floor coating companies in India. The nature of consideration will be cash being an amount of Rs 96.40 crore in aggregate payable to the existing shareholders of CIPY for the purchase of a portion of the shares held by them in CIPY. The acquisition will help Pidilite Industries to participate in the growth of the resin flooring and floor coatings market. The turnover of CIPY was Rs 110.40 crore for the year 2016-17. Earlier, the Board of Directors of Pidilite Industries at its meeting held on 5 January 2018 approved acquisition of 70% equity shares of CIPY Polyurethanes Pvt. Ltd.
On 7 March 2018, Pidilite Industries announced that it has entered into a collaboration with Jowat SE, a German family-owned enterprise and one of the leading suppliers of industrial adhesives worldwide. As part of the collaboration, Pidilite will now exclusively handle sales and distribution of the entire range of Jowat adhesives in India and other neighboring countries including Sri Lanka, Bangladesh, and Nepal. In addition to this, the two companies have also entered into a technical collaboration encompassing the high growth, specialised category of Hot Melt adhesives. This will provide a comprehensive range of Thermoplastic Hot Melt adhesives for use in several industrial, and modular and other wooden furniture segments.
The total capital expenditure during the FY2019 was Rs 186.23 crore, spent on fixed assets for various manufacturing units, offices, laboratories, warehouses and on information technology.
During the year 2018-19, investment of Rs 61.04 crore (previous year Rs 151.19 crore) was made in the subsidiaries. Of this, Rs 26.24 crore was invested in the overseas subsidiaries and Rs 34.80 crore in the domestic subsidiaries.
The investments in overseas subsidiaries were in Pidilite Middle East Ltd (Rs 5.31 crore) and Pidilite International Pte Ltd (Rs 4.17 crore) for onward investments in their step down subsidiaries and Pulvitec do Brasil Industria e Comercio de Colas e Adesivos Ltda (Rs 9.35 crore) and in newly incorporated subsidiary Pidilite Ventures LLC (Rs 7.41 crore).
The investments in domestic subsidiaries were in ICA Pidilite Pvt. Ltd. (Rs 26.64 crore) and Cipy Polyurethanes Pvt. Ltd. (Rs 8.16 crore).
During the FY2019, Percept Waterproofing Services Limited (Percept) (80% subsidiary of the Company) was merged with Nina Waterproofing Systems Private Limited (Nina) (70% subsidiary of the Company), pursuant to the Hon'ble National Company Law Tribunal, Mumbai Bench Order dated 11th January 2019 w.e.f. the appointed date i.e. 1st April 2017 and consequently, Percept stands dissolved without winding up. Further, post the said merger w.e.f. 27th March 2019, Nina's name was changed to AEKAM Construction Specialties Private Limited (AEKAM) and w.e.f. 15th April 2019, AEKAM is known as Nina Percept Private Limited. Accordingly, the Company's investment in Percept is merged with Nina Percept Private Limited and the Company now holds 71.53% stake in the merged entity.
The Company incorporated a wholly owned subsidiairy in USA, Pidilite Ventures LLC, which shall be engaging mainly in the investments in early stage operating companies in USA.
Pidilite Lanka (Private) Limited (Pidilite Lanka) (a step down subsidiary of the Company in Sri Lanka) has entered into an agreement with Nina Waterproofing Systems Private Limited now known as Nina Percept Private Limited (Nina) and Nina Lanka Construction Technologies (Pvt) Ltd (Nina Lanka) (a wholly owned subsidiary of Nina in Sri Lanka and also a step down subsidiary of the Company) to acquire up to 40% of the share capital in Nina Lanka. As on 31st March 2019, Pidilite Lanka has acquired 25.2% stake in Nina Lanka.
Pidilite International Pte. Ltd., a wholly owned subsidiary of the Company in Singapore, alongwith Crown Classics Limited, a company in Kenya, has promoted a joint venture company in Kenya namely Pidilite East Africa Limited (PEAL) to carry on business of construction chemicals and waterproofing material. PEAL, by virtue of control, is a step-down subsidiary of the Company.
Fevicol was awarded the 'Evergreen Brand' Award at the Pitch (Magazine) Top 50 Brands Awards 2019. The Fevicryl Colours bus shelter on World Colouring Book Day won a Bronze at the Neon OOH 2019 outdoor advertising awards.
The total capital expenditure during the FY2020 was Rs 369.03 crore (previous year Rs 186.23 crore) primarily spent on fixed assets for various manufacturing units, offices, laboratories, warehouses and on information technology.
During the year 2019-20, investment of Rs 146.18 crore (previous year Rs 61.04 crore) was made in subsidiaries. Of this, Rs 127.08 crore was invested in domestic subsidiaries and Rs 19.10 crore in overseas subsidiaries.
The investments in domestic subsidiaries were in Madhumala Ventures Pvt. Ltd. (formerly known as Madhumala Traders Pvt. Ltd.) amounting to Rs 126.47 crore and in newly incorporated subsidiaries namely Pidilite Litokol Pvt Ltd (Rs 0.60 crore) and Pidilite Grupo Puma Manufacturing Ltd (Rs 0.01 crore).
The investments in overseas subsidiaries were in Pidilite International Pte Ltd., Singapore (Rs 18.03 crore), Pidilite Chemical PLC, Ethiopia (Rs 0.75 Crore) and Pidilite Industries Egypt SAE (Rs 0.32 crore).
During the FY2020,the Company along with Litokol S.p.A, Italy has incorporated a joint venture subsidiary in the name of 'Pidilite Litokol Private Limited' (PLPL) on 7th October 2019 to carry on the business of chemicals epoxy grouts, chemical based products etc. The Company holds 60% of the paid up share capital and has management control of PLPL.
The Company alongwith Corporacion Empresarial Grupo Puma S.L., Spain has incorporated a joint venture subsidiary in the name of 'Pidilite Grupo Puma Manufacturing Limited' (PGPML) on 13th January 2020 to carry on the business of manufacturing, processing and distribution of technical mortars and other materials used in construction. The Company holds 50% of the paid up share capital and has management control of PGPML.
Nina Percept Private Limited (NPPL), subsidiary of the Company along with Pidilite Speciality Chemicals Pvt Ltd (PSCB), a step down subsidiary of the Company, has incorporated a company on 29th January 2020, in Bangladesh namely 'Nina Percept (Bangladesh) Pvt Ltd.' to carry on the business of roofing and waterproofing services in Bangladesh. NPPL holds 99% of the paid up share capital of Nina Percept (Bangladesh) Pvt. Ltd and the balance 1% is held by PSCB
The Company alongwith Chetana Expotential Technologies Pvt Ltd, Bangalore has incorporated a joint venture company in the name of 'Pidilite C-Techos Walling Limited' (PCWL) on 5th March 2020, to carry on the business of construction of building works or any other structural or architectural work of any kind using C-Techos wall technology, manufacturing of ACC panels and other ancillary products. The Company holds 60% of the paid up share capital and has management control of PCWL.
The Company has, for operational convenience and synergies, entered into a business transfer agreement for acquiring the business of wholly owned entity, M/s. Nitin Enterprise (a partnership firm having two partners, both of which are wholly owned subsidiaries of the Company) on a slump sale basis for a cash consideration of an amount not exceeding Rs 18.50 crore subject to necessary approvals. The acquisition process is likely to be completed during the financial year 2020-21.
Madhumala Ventures Pvt Ltd (formerly known as Madhumala Traders Pvt Ltd), a wholly owned subsidiary of the Company, has made three strategic investments in relevant start-ups in the domain of home d cor, furnishings, painting and waterproofing aggregating to Rs 122.48 crore. With these investments, the Company intends to support and collaborate with these start ups for mutual benefits.
Pursuant to a share purchase agreement executed with Tenax S.p.A, Italy, the Company acquired 70% of the share capital of Tenax India Stone Products Pvt. Ltd. for a cash consideration of approx. Rs 80 crore. The acquisiton process was completed on 28th May 2020.
In March 2020, the World Health Organisation declared COVID 19 to be a pandemic. The operation of the Company were disrupted since mid of March 2020. The outbreak of COVID 19 pandemic and consequent lockdown has impacted the regular business operations.
The Company has acquired 70% stake in equity shares of Tenax India Stone Products Pvt. Ltd ('Tenax') from Tenax SPA Italy (Tenax Italy) thereby making Tenax a subsidiary of the Company on 28th May 2020. Tenax Italy is the leading manufacturer of adhesives, coating, surface treatment chemicals and abrasives for the marble, granite and stone industry. Tenax is engaged in the in the sales and distribution of Tenax Italy products for the retail market in India.
The Board of Directors at its meeting held on 28th October 2020, approved a definitive agreement with Huntsman Group (USA) to acquire 100% stake in one of the subsidiary in India namely Huntsman Advanced Materials Solutions Private Limited (HAMSPL) for a cash consideration of approximately Rs. 2,100 Crore, excluding customary working capital and other adjustments. Huntsman Group is a leading global producer of differentiated organic chemical products. HAMSPL manufactures and sells Adhesives, Sealants and other products under well-known brands such as Araldite, Araldite Karpenter and Araseal. The Company has completed the acquisition of 100% stake in HAMSPL on 3rd November 2020, thus HAMSPL has become a subsidiary of the Company.
Pidilite Industries Ltd
Company History
Pidilite Industries Limited (PIL) was incorporated on 28th July, 1969 as a consumer and specialities chemical company. The Company is the market leader in adhesives and sealants, construction chemicals, hobby colours and polymer emulsions in India. Its brand name Fevicol has become synonymous with adhesives to millions in India and is ranked amongst the most trusted brands in India. The company's product range includes Adhesives and Sealants, construction chemicals, craftsmen products, polymer emulsions, paint chemicals, automotive chemicals, art materials and stationery, fabric care, maintenance chemicals, industrial adhesives, industrial, textile resins and organic pigments and preparations. Some of the company's major brands are M-Seal, Fevikwik, Fevistik, Roff, Dr. Fixit, Fevicryl, Motomax and Hobby Ideas.
Pidilite was the first company in India, which started production of violet pigment in the year 1973. In 1984, the company's consumer product division was born and in 1989 the company entered fevicryl acrylic colours transform fabric and multi-surface painting market. The Company made its maiden public offering of equity shares in the year 1993. During the year 1995, plants of the company in Mumbai and Vapi acquired an ISO 9001 certification. Also the plant at Mahad received an ISO 9002 certification in the same year. Fevicol, the premier brand of the company ranked among the Top 15 Indian brands by FE Brandwagon Year Book 1997. After two years, in 1999, Pidilite had acquired 'Ranipal', leading brand of optical whitener and subsequently acquired 'M-Seal', leading brand of epoxy compounds in the year of 2000. In the identical year of 2000 itself, Fevicol campaign won the Silver ABBY for the Campaign of the Century in India. The Company had launched Dr. Fixit range of Construction Chemicals in the year 2001 and had acquired 'Steelgrip', leading brand of PVC insulation tape in India during the year 2002. Pidilite had again acquired the Roff' brand of Construction Chemicals in the year of 2004.
A wholly-owned subsidiary in Singapore, under the banner 'Pidilite International Pte Ltd was incorporated by the company in the year 2005 for its international operations, encompassing the acquisition of overseas companies and joint ventures. Also in the same year 2005, Pidilite had acquired Chemson Asia Pte Ltd, an existing Singapore-based company in the business of manufacturing waterproof coating and emulsion paints, thereby adding to its existing, and rapidly-growing construction chemicals and paints range and the company had took over Jupiter Chemicals in Dubai. During the identical year of 2005, the company had incorporated a subsidiary, namely 'Pidilite Do Brasil Desenvolvimento De Negocios Ltd', in Sao Paulo, Brazil and 'Pidilite Middle East Limited', as an offshore company in the Jebel Ali Free Zone of Dubai.
During the year 2006, Pidilite had acquired Tristar Colman brand and business, Tristar Fine Art, a market leader in brushes for drawing and painting and Bamco Thailand, a Construction Chemical company. Also Pidilite had acquired the business and assets of Sargent Art Inc through a subsidiary Pidilite USA Inc, Delaware. The Company had established its R&D centre in Singapore under the banner 'Pidilite Innovation Centre Pte Ltd.' Pidilite had de-merged VAM manufacturing unit at Mahad of Vinyl Chemicals (India) Ltd into the company with effect from 1st April of the year 2007. During 2007-08, Fevicol 1K PUR and Fevicol Kwikgrab were introduced by the company to take care of special applications in building construction segment. Pidilite with its wholly-owned subsidiaries had acquired assets and business of branded sealants and adhesives from Hardcastle & Waud Manufacturing Co. Ltd and associates. The Company had acquired Bhimad Commercial Co. and Madhumala Traders by investing Rs 170,000 each in February of the year 2008. Fevicol has been ranked No. 1 in Household Care Segment in June 2008.
The Board of Directors of Pidilite Industries at its meeting held on 10 June 2013 decided to explore induction of a strategic partner for the Synthetic Elastomer Project.
On 22 September 2014, Pidilite Industries announced that its Board of Directors has approved the acquisition of the adhesive business of Blue Coat Private Limited on a slump sale basis for a cash consideration of Rs 263.57 crore.
On 12 December 2014, Pidilite Industries announced that the company along with its wholly owned subsidiary Pidilite International Pte Ltd. has incorporated a private limited subsidiary company in Ethiopia on 10 December 2014 in the name of Pidilite Chemical PLC for manufacture of adhesives, mastics, paints, varnishes or similar coatings, printing, writing and painting inks etc.
The Board of Directors of Pidilite Industries at its meeting held on 30 March 2015 approved investment in equity shares of Nina Waterproofing Systems Private Limited. The proposed shareholding of the company in Nina will be 70%, thereby making Nina a subsidiary of the company. The initial investment of Pidilite Industries in Nina will be about Rs 23.33 lakh. The Board has also approved additional investment up to Rs 100 crore in Nina.
On 16 April 2015, Pidilite Industries announced that its subsidiary Nina Waterproofing Systems Private Ltd. (NWSP) has acquired the waterproofing business of Nina Concrete Systems Private Ltd. (NCS) on a slump sale basis. PIL holds 70% of the paid up capital in NWSP. The waterproofing business under the brand name NINA was established in 1965. NINA is recognized as one of the leading waterproofing solution contractors in India. NINA has its major presence across the construction spectrum including residential, commercial, industrial, institutional and infrastructure segments.
On 25 November 2015, Pidilite Industries announced that the company along with its wholly owned subsidiary Fevicol Company Limited has on 20 November 2015 incorporated a company in the name of Wood Coat Private Limited to be engaged in all types of coatings for wood including wood stains, fillers, primers, wood finish etc.
On 30 November 2015, Pidilite Industries announced that Pidilite Lanka (Private) Limited, a step down subsidiary of the company incorporated in Sri Lanka, has acquired from CIC Holdings PLC, the Chemifix trade mark and other brands associated with PVAC Adhesives business along with the commercial and technical knowhow relating to PVAC Adhesive business. CIC Holdings PLC is a large conglomerate in Sri Lanka and is involved in number of segment in Sri Lanka such as chemicals, fertilizers, pharmaceuticals, agri chemical, food products etc.
On 25 April 2016, Pidilite Industries announced that its Board of Directors has approved execution of definitive agreements with INDUSTRIA CHIMICA ADRIATICA SPA (ICA), a leading wood finish manufacturer based in Italy. As part of the joint venture, Pidilite Industries along with its wholly owned subsidiary Fevicol Company Limited, will hold 50% of the shareholding in Wood Coat Private Limited (the joint venture company) and the remaining 50% of the shareholding will be held by ICA and Italcoats, a partnership firm and distributor of ICA wood finishes in India. The joint venture company will initially engage in high technology wood finish business in India and other select countries. Wood Coat Private Limited is currently a wholly owned subsidiary of Pidilite Industries.
The joint venture company will acquire the current wood finish distribution business of Italcoats and will be exclusive distributor of ICA wood finishes in India and other select countries. The joint venture company will also acquire technology and knowhow for manufacture of select wood finish products from ICA and shall be entitled to manufacture ICA wood finishes for marketing, distribution and sales in India and other select countries. Pidilite Industries' Board of Directors has approved an equity investment of up to Rs 63.75 crore on or before 15 May 2016 and a further equity investment of up to Rs 62.50 crore in accordance with the business requirements of the joint venture company.
On 16 June 2016, Pidilite Industries informed stock exchanges that its two wholly owned subsidiaries Pidilite International Pte. Ltd and Pidilite Middle East Ltd, have acquired shares of Nebula East Africa Private Limited (NEAPL), a company incorporated in Kenya. With this acquisition, the wholly owned subsidiaries of the company hold 100% of the paid up share capital (which is Kenyan Shillings 100,000) equivalent to approximately USD 1000 in NEAPL. NEAPL is proposed to be engaged in the business as manufacturers, importers, exporters, buyers, sellers etc. in adhesives, sealants, and all other products used for making or producing adhesives and sealants.
The Board of Directors of Pidilite Industries at its meeting held on 26 December 2017 approved buyback proposal for purchase by the company of its own fully paid up equity shares of Re 1 each not exceeding 50 lakh equity shares (being 0.975% of the total paid up equity capital of the company) at a price of Rs 1000 per share for an aggregate amount of up to Rs 500 crore. The proposed buyback will be through the tender offer route.
On 9 February 2018, Pidilite Industries announced that it has completed the acquisition of 70% equity shares of CIPY Polyurethanes Pvt. Ltd. CIPY is engaged in the business of manufacture and sale of floor coatings using polyurethanes, epoxies, polyurea and polyaspartic polymers. CIPY is one of the well-known floor coating companies in India. The nature of consideration will be cash being an amount of Rs 96.40 crore in aggregate payable to the existing shareholders of CIPY for the purchase of a portion of the shares held by them in CIPY. The acquisition will help Pidilite Industries to participate in the growth of the resin flooring and floor coatings market. The turnover of CIPY was Rs 110.40 crore for the year 2016-17. Earlier, the Board of Directors of Pidilite Industries at its meeting held on 5 January 2018 approved acquisition of 70% equity shares of CIPY Polyurethanes Pvt. Ltd.
On 7 March 2018, Pidilite Industries announced that it has entered into a collaboration with Jowat SE, a German family-owned enterprise and one of the leading suppliers of industrial adhesives worldwide. As part of the collaboration, Pidilite will now exclusively handle sales and distribution of the entire range of Jowat adhesives in India and other neighboring countries including Sri Lanka, Bangladesh, and Nepal. In addition to this, the two companies have also entered into a technical collaboration encompassing the high growth, specialised category of Hot Melt adhesives. This will provide a comprehensive range of Thermoplastic Hot Melt adhesives for use in several industrial, and modular and other wooden furniture segments.
The total capital expenditure during the FY2019 was Rs 186.23 crore, spent on fixed assets for various manufacturing units, offices, laboratories, warehouses and on information technology.
During the year 2018-19, investment of Rs 61.04 crore (previous year Rs 151.19 crore) was made in the subsidiaries. Of this, Rs 26.24 crore was invested in the overseas subsidiaries and Rs 34.80 crore in the domestic subsidiaries.
The investments in overseas subsidiaries were in Pidilite Middle East Ltd (Rs 5.31 crore) and Pidilite International Pte Ltd (Rs 4.17 crore) for onward investments in their step down subsidiaries and Pulvitec do Brasil Industria e Comercio de Colas e Adesivos Ltda (Rs 9.35 crore) and in newly incorporated subsidiary Pidilite Ventures LLC (Rs 7.41 crore).
The investments in domestic subsidiaries were in ICA Pidilite Pvt. Ltd. (Rs 26.64 crore) and Cipy Polyurethanes Pvt. Ltd. (Rs 8.16 crore).
During the FY2019, Percept Waterproofing Services Limited (Percept) (80% subsidiary of the Company) was merged with Nina Waterproofing Systems Private Limited (Nina) (70% subsidiary of the Company), pursuant to the Hon'ble National Company Law Tribunal, Mumbai Bench Order dated 11th January 2019 w.e.f. the appointed date i.e. 1st April 2017 and consequently, Percept stands dissolved without winding up. Further, post the said merger w.e.f. 27th March 2019, Nina's name was changed to AEKAM Construction Specialties Private Limited (AEKAM) and w.e.f. 15th April 2019, AEKAM is known as Nina Percept Private Limited. Accordingly, the Company's investment in Percept is merged with Nina Percept Private Limited and the Company now holds 71.53% stake in the merged entity.
The Company incorporated a wholly owned subsidiairy in USA, Pidilite Ventures LLC, which shall be engaging mainly in the investments in early stage operating companies in USA.
Pidilite Lanka (Private) Limited (Pidilite Lanka) (a step down subsidiary of the Company in Sri Lanka) has entered into an agreement with Nina Waterproofing Systems Private Limited now known as Nina Percept Private Limited (Nina) and Nina Lanka Construction Technologies (Pvt) Ltd (Nina Lanka) (a wholly owned subsidiary of Nina in Sri Lanka and also a step down subsidiary of the Company) to acquire up to 40% of the share capital in Nina Lanka. As on 31st March 2019, Pidilite Lanka has acquired 25.2% stake in Nina Lanka.
Pidilite International Pte. Ltd., a wholly owned subsidiary of the Company in Singapore, alongwith Crown Classics Limited, a company in Kenya, has promoted a joint venture company in Kenya namely Pidilite East Africa Limited (PEAL) to carry on business of construction chemicals and waterproofing material. PEAL, by virtue of control, is a step-down subsidiary of the Company.
Fevicol was awarded the 'Evergreen Brand' Award at the Pitch (Magazine) Top 50 Brands Awards 2019. The Fevicryl Colours bus shelter on World Colouring Book Day won a Bronze at the Neon OOH 2019 outdoor advertising awards.
The total capital expenditure during the FY2020 was Rs 369.03 crore (previous year Rs 186.23 crore) primarily spent on fixed assets for various manufacturing units, offices, laboratories, warehouses and on information technology.
During the year 2019-20, investment of Rs 146.18 crore (previous year Rs 61.04 crore) was made in subsidiaries. Of this, Rs 127.08 crore was invested in domestic subsidiaries and Rs 19.10 crore in overseas subsidiaries.
The investments in domestic subsidiaries were in Madhumala Ventures Pvt. Ltd. (formerly known as Madhumala Traders Pvt. Ltd.) amounting to Rs 126.47 crore and in newly incorporated subsidiaries namely Pidilite Litokol Pvt Ltd (Rs 0.60 crore) and Pidilite Grupo Puma Manufacturing Ltd (Rs 0.01 crore).
The investments in overseas subsidiaries were in Pidilite International Pte Ltd., Singapore (Rs 18.03 crore), Pidilite Chemical PLC, Ethiopia (Rs 0.75 Crore) and Pidilite Industries Egypt SAE (Rs 0.32 crore).
During the FY2020,the Company along with Litokol S.p.A, Italy has incorporated a joint venture subsidiary in the name of 'Pidilite Litokol Private Limited' (PLPL) on 7th October 2019 to carry on the business of chemicals epoxy grouts, chemical based products etc. The Company holds 60% of the paid up share capital and has management control of PLPL.
The Company alongwith Corporacion Empresarial Grupo Puma S.L., Spain has incorporated a joint venture subsidiary in the name of 'Pidilite Grupo Puma Manufacturing Limited' (PGPML) on 13th January 2020 to carry on the business of manufacturing, processing and distribution of technical mortars and other materials used in construction. The Company holds 50% of the paid up share capital and has management control of PGPML.
Nina Percept Private Limited (NPPL), subsidiary of the Company along with Pidilite Speciality Chemicals Pvt Ltd (PSCB), a step down subsidiary of the Company, has incorporated a company on 29th January 2020, in Bangladesh namely 'Nina Percept (Bangladesh) Pvt Ltd.' to carry on the business of roofing and waterproofing services in Bangladesh. NPPL holds 99% of the paid up share capital of Nina Percept (Bangladesh) Pvt. Ltd and the balance 1% is held by PSCB
The Company alongwith Chetana Expotential Technologies Pvt Ltd, Bangalore has incorporated a joint venture company in the name of 'Pidilite C-Techos Walling Limited' (PCWL) on 5th March 2020, to carry on the business of construction of building works or any other structural or architectural work of any kind using C-Techos wall technology, manufacturing of ACC panels and other ancillary products. The Company holds 60% of the paid up share capital and has management control of PCWL.
The Company has, for operational convenience and synergies, entered into a business transfer agreement for acquiring the business of wholly owned entity, M/s. Nitin Enterprise (a partnership firm having two partners, both of which are wholly owned subsidiaries of the Company) on a slump sale basis for a cash consideration of an amount not exceeding Rs 18.50 crore subject to necessary approvals. The acquisition process is likely to be completed during the financial year 2020-21.
Madhumala Ventures Pvt Ltd (formerly known as Madhumala Traders Pvt Ltd), a wholly owned subsidiary of the Company, has made three strategic investments in relevant start-ups in the domain of home d cor, furnishings, painting and waterproofing aggregating to Rs 122.48 crore. With these investments, the Company intends to support and collaborate with these start ups for mutual benefits.
Pursuant to a share purchase agreement executed with Tenax S.p.A, Italy, the Company acquired 70% of the share capital of Tenax India Stone Products Pvt. Ltd. for a cash consideration of approx. Rs 80 crore. The acquisiton process was completed on 28th May 2020.
In March 2020, the World Health Organisation declared COVID 19 to be a pandemic. The operation of the Company were disrupted since mid of March 2020. The outbreak of COVID 19 pandemic and consequent lockdown has impacted the regular business operations.
The Company has acquired 70% stake in equity shares of Tenax India Stone Products Pvt. Ltd ('Tenax') from Tenax SPA Italy (Tenax Italy) thereby making Tenax a subsidiary of the Company on 28th May 2020. Tenax Italy is the leading manufacturer of adhesives, coating, surface treatment chemicals and abrasives for the marble, granite and stone industry. Tenax is engaged in the in the sales and distribution of Tenax Italy products for the retail market in India.
The Board of Directors at its meeting held on 28th October 2020, approved a definitive agreement with Huntsman Group (USA) to acquire 100% stake in one of the subsidiary in India namely Huntsman Advanced Materials Solutions Private Limited (HAMSPL) for a cash consideration of approximately Rs. 2,100 Crore, excluding customary working capital and other adjustments. Huntsman Group is a leading global producer of differentiated organic chemical products. HAMSPL manufactures and sells Adhesives, Sealants and other products under well-known brands such as Araldite, Araldite Karpenter and Araseal. The Company has completed the acquisition of 100% stake in HAMSPL on 3rd November 2020, thus HAMSPL has become a subsidiary of the Company.
Pidilite Industries Ltd
Directors Reports
To
The Members
Your Directors take pleasure in presenting the Fifty-Third Annual
Report together with Audited Financial Statements for the year ended 31st
March, 2022.
Financial Results (Standalone)
|
(' in crores ) |
|
|
2021-22 |
2020-21 |
| Sales |
8,298.49 |
6,186.67 |
| Operating Profit |
1,842.38 |
1,623.30 |
| Finance Costs |
(26.42) |
(16.99) |
| Depreciation, Amortisation and Impairment Expense |
(175.12) |
(147.10) |
| Net Foreign Exchange Loss |
(13.35) |
(2.13) |
| Profit Before Exceptional Items and Tax |
1,627.49 |
1,457.08 |
| Exceptional Items |
- |
(0.45) |
| Profit Before Tax |
1,627.49 |
1,456.63 |
| Current Year?s Tax |
(360.95) |
(375.05) |
| Deferred Tax |
2.08 |
(0.12) |
| Profit After Tax |
1,268.62 |
1,081.46 |
| Profit Brought Forward |
4,123.49 |
3,042.74 |
| Other Comprehensive Income Included in Retained Earnings (Net
of tax) |
(9.07) |
(0.71) |
| Profit Available for Appropriation |
5,383.04 |
4,123.49 |
| Appropriations |
|
|
| Dividend Paid |
(431.93)# |
- |
| Closing balance of Retained Earnings |
4,951.11 |
4,123.49 |
Financial Performance
Comments on Financial Performance are included in Management Discussion
and Analysis section.
Dividend
Your Directors recommend a dividend of ' 10.00 per equity share of '
1/- each (previous year ' 8.50 per equity share of ' 1/- each) amounting to ' 508.29
crores (previous year ' 431.93 crores) out of the current year?s profit, on ' 50.83
crores equity capital (previous year ' 50.82 crores). The dividend payout amount has grown
at a CAGR of 13.65% during the last 5 years.
# Pertaining to dividend for FY 2020-21
The dividend payout is in accordance with the Dividend Distribution
Policy which is available on the website of the Company
www.pidilite.com.
Transfer to Reserves
The Company does not propose to transfer amounts to the general
reserve.
Term Finance
The Company has no outstanding term loans (previous year NIL).
Capital Expenditure
The total capital expenditure during the year was ' 370.45 crores
(previous year ' 336.69 crores) primarily spent on fixed assets for various manufacturing
units, offices, laboratories, warehouses and on information technology.
Deposits
The Company has not accepted any deposits covered under Chapter V of
the Companies Act, 2013 during the financial year 2021-22 (previous year NIL).
Subsidiaries
Investment in Subsidiaries
During the year, total investment of ' 104.94 crores (previous year '
2,323.04 crores) was made in domestic subsidiaries.
The investments in domestic subsidiaries were in Madhumala Ventures Pvt
Ltd amounting to (' 54.96 crores), Pidilite C-Techos Walling Ltd (' 1.21 crores) and Cipy
Polyurethanes Private Limited (? 48.77 crores).
During the year
a. Scheme of Amalgamation of Pidilite Adhesives Private Limited (PAPL)
with the Company was approved by the Hon?ble National Company Law Tribunal, Mumbai
Bench on 7th March, 2022. The scheme is effective from 1st April,
2022 which is the appointed date. The Company has completed the statutory requirements
including filing of Form INC28 with the Ministry of Corporate Affairs and hence PAPL
stands dissolved.
b. Scheme of Amalgamation of Cipy Polyurethanes Private Limited (CIPY)
with the Company was approved by the Hon?ble National Company Law Tribunal, Mumbai
Bench on 23rd March, 2022. The scheme is effective from 1st April,
2022 which is the appointed date. The Company has completed the statutory requirements
including filing of Form INC28 with the Ministry of Corporate Affairs and hence CIPY
stands dissolved.
c. The Company through its subsidiary Madhumala Ventures Pvt. Ltd. made
investments in early-stage companies which would augment our capabilities.
d. The names of following two subsidiaries have been struck off by the
Registrar of Companies u/s 248 of the Companies Act during the F Y 2021-22 in absence of
any business, since their incorporation:
(i) Pidilite C-Techos Pvt. Ltd. and (ii) Pidilite Grupo Puma Pvt.Ltd.
e. ICA Pidilite Pvt Ltd, subsidiary of the Company made Buy back of
shares from all shareholder?s resulting into reduction in investments of the Company
by ' 11.28 crores.
Performance of Major Domestic and Overseas Subsidiaries
| Name of Subsidiary |
Sales |
Sales |
% Growth |
EBITDA |
EBITDA |
% Growth |
|
2021 -22 |
2020-21 |
|
2021-22 |
2020-21 |
|
| Nina Percept Pvt Ltd |
258.59 |
176.63 |
46.4% |
(25.42) |
(26.93) |
5.6% |
| ICA Pidilite Pvt Ltd |
272.12 |
178.21 |
52.7% |
40.99 |
25.19 |
62.7% |
| CIPY Polyurethanes Pvt Ltd |
126.84 |
89.68 |
41.4% |
12.35 |
1.63 |
658.0% |
| Pidilite Adhesives Pvt Ltd |
495.74 |
168.32* |
194.5% |
160.86 |
60.32* |
166.6% |
| Pidilite Speciality Chemicals Bangladesh Pvt Ltd |
171.74 |
110.80 |
55.0% |
31.47 |
17.04 |
84.7% |
| Pidilite Lanka (Pvt) Ltd |
59.58 |
42.17 |
41.3% |
4.53 |
6.45 |
(29.8%) |
| Pidilite USA Inc |
128.49 |
141.30 |
(9.1%) |
8.24 |
18.61 |
(55.7%) |
| Pulvitec do Brasil Industria e Comercio de Colas e Adesivos
Ltda |
95.50 |
105.65 |
(9.6%) |
1.30 |
23.70 |
(94.5%) |
| Pidilite Industries Egypt SAE includes PIL Trading (Egypt)
Company |
46.78 |
36.90 |
26.8% |
(4.22) |
(0.77) |
(445.4%) |
| Pidilite Bamco Ltd includes Bamco Supply and Services Ltd
(Thailand) |
56.66 |
62.37 |
(9.2%) |
6.86 |
8.76 |
(21.7%) |
| Pidilite MEA Chemicals LLC (UAE) |
133.93 |
110.22 |
21.5% |
1.22 |
(3.13) |
138.9% |
Overseas subsidiaries figures are at constant currency.
'Sales and EBITDA for Pidilite Adhesives Pvt. Ltd. for FY 2020-21 are
from 4th November, 2020 to 31st March, 2021 and therefore not
comparable with FY 2021-22.
Domestic Subsidiaries in Consumer and Bazaar segment registered good
sales growth and healthy margins. The Subsidiaries sales growth in Business to Business
segment showed signs of revival but EBITDA remained under pressure due to higher input
costs.
Pidilite Bangladesh reported strong volume-led growth across categories
with healthy EBITDA margin on back of improved gross margin due to pricing actions and
cost control measures.
Pidilite Lanka continued with its sales growth momentum in a very
challenging economic environment. However, the profitability was significantly impacted
due to socioeconomic and political crisis and steep currency devaluation.
Pidilite USA posted sales and EBITDA decline primarily due to
moderation of demand in hobby and craft products in the post pandemic period as well as
material cost increases.
Pidilite Brazil recorded lower sales mainly on account of overall
economic slowdown and higher growth in the prior year due to fiscal stimulus. Operating
profits remain low due to significant input cost inflation and competitive pricing
pressure.
Our subsidiary in the Middle East reported healthy sales performance on
account of good demand from re-export market.
Consolidated Financial Statements
In accordance with the provisions of Companies Act, 2013 (hereinafter
referred to as ‘the Act?), Regulation 33 of the Securities and Exchange Board of
India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter
referred to as ‘Listing Regulations?) and applicable Accounting Standards, the
Audited Consolidated Financial Statements of the Company for the financial year 2021 -22,
together with the Auditor?s Report, form part of this Annual Report. A statement
containing the salient features of the Company?s subsidiaries, associate and joint
venture company in the prescribed Form AOC- 1, are set out in Note No. 59 to the
Consolidated Financial Statements.
The Consolidated Financial Statements have been prepared on the basis
of audited financial statements of the Company, its subsidiaries, associate company and
joint venture, as approved by their respective Board of Directors except Pulvitec Do
Brazil Industria e Comercio de Colas e Adesivos Ltda which has been approved by the local
administrator and Plus Call Technical Services LLC, Dubai for which the financial
statements has been approved by the management.
The accounts of the subsidiaries are also uploaded on the website of
the Company, www.pidilite.com.
Directors and Key Managerial Personnel
Smt. Meher Pudumjee was appointed as an Additional Director of the
Company, by the Board on the recommendation of Nomination and Remuneration Committee, with
effect from 18th May, 2022. Members? approval is sought for her
appointment as an Independent Director of the Company for a period of five years with
effect from 18th May, 2022.
Shri Sudhanshu Vats was appointed as an Additional Director designated
as Deputy Managing Director, by the Board on the recommendation of Nomination and
Remuneration Committee, with effect from 18th May,
2022. Members? approval is sought for his appointment as Whole
Time Director designated as Deputy Managing Director of the Company for a period of five
years with effect from 18th May, 2022.
Shri A B Parekh Whole Time Director has been appointed by the Board as
Executive - Vice Chairman with effect from 11th August, 2021.
Shri Puneet Bansal, resigned with effect from 16th September
2021, as the Company Secretary and Compliance Officer (Key Managerial Personnel) of the
Company. Shri Pradip Menon, Chief Financial Officer (Key Managerial Personnel) of the
Company, resigned with effect from 21st December, 2021.
In terms of Section 203 of the Act and applicable provision of Listing
Regulations, the Board of Directors have appointed Smt. Manisha Shetty as the Company
Secretary and Compliance Officer (Key Managerial Personnel) of the Company with effect
from 11th March, 2022 and Shri Sandeep Batra as Chief Financial Officer (Key
Managerial Personnel) of the Company with effect from 1st June, 2022.
In accordance with the Act and the Articles of Association of the
Company, Shri A B Parekh and Shri N K Parekh, Directors of the Company, retire by rotation
and being eligible, offers themselves for re-appointment.
Amendment of Article 22 of Articles of Association of the Company
The Board of Directors have approved amendment of Article 22 of
Articles of Association of the Company to increase the limit on maximum number of
Directors from existing 15 Directors to 18 Directors. As per the amended Article 22 the
number of Directors of the Company shall not be less than 3 (three) and not more than 18
(eighteen). Members? approval is sought to amend the existing Article 22 and to
increase the maximum number of Directors.
Policy on Directors? remuneration
The policy on Directors? remuneration is available on the website
of the Company, www.pidilite.com. The remuneration paid to the Directors is as per the
terms laid out in the said policy.
Directors? Responsibility Statement
Your Directors confirm that:
• in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation relating to material
departures;
• they 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 ended 31st March, 2022 and of the profit of the Company for that
period;
• they have taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of the Companies Act,
2013 for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities;
• they have prepared the annual accounts on a going concern basis;
• they have laid down internal financial controls to be followed
by the Company and that such internal financial controls are adequate and are operating
effectively; and
• they have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems are adequate and operating
effectively.
Annual Evaluation by the Board of its own performance, its Committees
and individual Directors
The Board has put in place a mechanism for evaluation of its own
performance and performance of its Committees and individual Directors. The evaluation of
the Board,
Committees, Directors and Chairman of the Board was conducted based on
the evaluation parameters, such as Board composition and structure, effectiveness of the
Board, participation at meetings, domain knowledge, awareness and observance of
governance, etc. For further details, please refer to the Report on Corporate Governance,
which forms a part of this Annual Report.
Familiarisation Programme
The Company has put in place an induction and familiarization programme
for all its Directors including the Independent Directors.
The familiarization programme for Independent Directors in terms of
provisions of Regulation 46(2)(i) of the Listing Regulations is uploaded on the website of
the Company. Number of Meetings of Board of Directors
Seven meetings of the Board of Directors of the Company were held
during the financial year 2021 - 22. For further details, please refer to the Report on
Corporate Governance, which forms a part of this Annual Report.
Statement of Declaration on Independence given by Independent Directors
All the Independent Directors of the Company have given declarations
that:
a. they meet the criteria of independence as laid down under the Act
and the Listing Regulations and
b. they have registered their names in the Independent Directors?
Databank.
Corporate Governance
The Company is committed to good corporate governance practices. The
Report on Corporate Governance, as stipulated under Listing Regulations, forms an integral
part of this Annual Report. The requisite certificate from M/s M. M. Sheth & Co.,
Practising Company Secretaries, is attached to the Report on Corporate Governance, which
forms a part of this Annual Report.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the year under
review, as stipulated under the Listing Regulations, is presented in a section forming
part of this Annual Report. For the sake of brevity the items covered in this Report are
not repeated in the Management Discussion and Analysis Report.
Committees of the Board
The following are the statutory Committees constituted by the Board and
they function according to their respective roles and defined scope:
• Audit Committee
• Nomination and Remuneration Committee
• Corporate Social Responsibility Committee
• Stakeholders Relationship Committee
• Risk Management Committee
Details of composition, terms of reference and number of meetings held
for respective Committees are given in the Report on Corporate Governance, which forms a
part of this Annual Report. Further, during the year under review, all recommendations
made by the Audit Committee have been accepted by the Board.
Corporate Social Responsibility (CSR) Report and Policy
The CSR Report as per Section 135 of the Act read with Companies
(Corporate Social Responsibility Policy) Rules, 2014 and amendments thereto, is attached
as Annexure 1 to this Report. The details of CSR Initiatives forms part of Social &
Community Service Initiatives section of this Annual Report. CSR Policy can be accessed on
website of the Company www.pidilite.com.
Vigil Mechanism / Whistle Blower Policy
The Company has established a Vigil Mechanism and Whistle Blower Policy
for its Directors and employees. The said policy has been communicated to the Directors
and employees of the Company and is also posted on the website of the Company. For further
details, please refer to the Report on Corporate Governance, which forms a part of this
Annual Report.
Policy relating to Prevention of Sexual Harassment
The Company has formulated a Prevention of Sexual Harassment Policy and
has formed Internal Complaints Committee, as per statutory requirements. For further
details, please refer to the Report on Corporate Governance, which forms a part of this
Annual Report.
Statutory Auditors
In accordance with the provisions of the Act,
M/s Deloitte Haskins & Sells LLP, Chartered Accountants (Firm
Registration No 117366W/W-100018) have been appointed as the Statutory Auditors of the
Company, for a period of five years i.e., upto the conclusion of 54th AGM to be
held for the adoption of accounts for the year ending 31st March 2023. Auditors
have confirmed that they are not disqualified from continuing as Auditors of the Company.
There is no qualification or adverse remark in Auditors? Report.
There is no incident of fraud requiring reporting by the Auditors under Section 143(12) of
the Act.
Cost Auditor
The Company has maintained cost records as specified by Central
Government u/s 148(1) of the Act. M/s. V J Talati & Co., Cost Accountants, were
appointed as the Cost Auditor for the financial year 2021-22 to conduct the audit of the
cost records of the Company and they have been reappointed as the Cost Auditor for the
financial year 2022-23. In terms of the provisions of Section 148(3) of the Act, read with
the Companies (Audit and Auditors) Rules, 2014, as amended, the remuneration payable to
the Cost Auditor has to be ratified by the Members of the Company. Accordingly, at the
ensuing AGM, the Board seeks ratification of the remuneration payable to the Cost Auditor
for the financial year 2022-23.
Secretarial Auditor and Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Act and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has
appointed M/s M. M. Sheth & Co., Practising Company Secretaries to undertake the
Secretarial Audit of the Company for the financial year 2021-22. The Report of the
Secretarial Auditors attached as Annexure 2 to this Report. There is no qualification or
adverse remark in their Report.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo
The particulars under Section 134 of the Act, read with the Companies
(Accounts) Rules, 2014 are attached as Annexure 3 to this Report.
Risk Management
In compliance with Regulation 21 of the Listing Regulations, a Risk
Management Committee has been constituted by the Board. The Risk Management Committee,
also known as Risk Management Oversight Committee, is entrusted with roles and powers as
specified in Part D of Schedule II of Listing Regulations.
The Company has laid out a risk management policy for identification
and mitigation of risks. The Company has also constituted a Management Risk Committee
which is chaired by the Managing Director and has Senior Leadership of the Company as its
members.
The Management Risk Committee identifies the key risks for the Company,
develops and implements the risk mitigation plan, reviews and monitors the risks and
corresponding mitigation plans on a regular basis and prioritises the risks, if required,
depending upon the effect on the business/reputation.
The other details in this regard are provided in the Report on
Corporate Governance, which forms a part of this Annual Report.
Contracts and Arrangements with Related Parties
All contracts/arrangements entered into by the Company during the
financial year under review, with related parties (as defined in the Act and Listing
Regulations) were in the ordinary course of business and on an arm?s length basis.
During the year, the Company did not enter into any contract/arrangement/transaction with
related parties which could be considered as material in accordance with the Policy of the
Company on Materiality of Related Party Transactions (RPT Policy) or which is required to
be reported in Form No. AOC-2 in terms of Section 134(3)
(h) read with Section 188 of the Act and Rule 8(2) of the Companies
(Accounts) Rules, 2014.
The RPT Policy, as approved by the Board, is available on the
Company?s website: www.pidilite.com.
Disclosure of related party transactions with the
promoter(s)/promoter(s) group which individually hold 10% or more shareholding of the
Company, as per the Indian Accounting Standards, are set out in Note No. 44 the Standalone
Financial Statements of the Company.
Particulars of Loans, Guarantees or Investments
Details of loans, guarantees or investments covered under the
provisions of Section 186 of the Act are given in the Notes to the Financial Statements.
Employees Stock Option Scheme
The Employees Stock Option Scheme (Scheme) is in line with SEBI (Share
Based Employee Benefits) Regulations, 2014 (SBEB Regulations). The certificate of
Secretarial Auditors regarding implementation of the Scheme is available for inspection of
Members in electronic mode.
The applicable disclosure, as stipulated under Securities and Exchange
Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as on
31st March 2022 with regard to Scheme, is provided in Annexure 4 to this
Report.
Extract of Annual Return
Extract of Annual Return of the Company is available on the website of
the Company viz. www.pidilite.com.
Business Responsibility Report
A Business Responsibility Report as per Regulation 34 of the Listing
Regulations, detailing the various initiatives taken by the Company on the environmental,
social and governance front, forms an integral part of this Report.
Internal Control Systems and their Adequacy
The Company has adequate internal financial control procedures
commensurate with its size and nature of business.
The Company has appointed Internal Auditors who periodically audit the
adequacy and effectiveness of the internal controls laid down by the management and
suggest improvements.
The Audit Committee of the Board of Directors approves the annual
internal audit plan and periodically reviews the progress of audits as per approved audit
plans along with critical internal audit findings presented by internal auditors, status
of implementation of audit recommendations, if any, and adequacy of internal controls.
Significant/Material Orders Passed by the Regulators
There are no significant/material orders passed by the Regulators or
Courts or Tribunals impacting the going concern status of the Company and its operations
in future.
Particulars of Employees and Related Disclosures
Disclosure pertaining to remuneration as per Section 197(12) of the
Act, read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 is
attached as Annexure 5 to this Report.
Details of employee remuneration as required under provisions of
Section 197 of the Act, and Rule 5(2) of Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 (including any modifications, thereof) shall be made
available to any shareholder, on request.
General
The Company has neither issued equity shares with differential rights
nor any sweat equity shares.
There have been no material changes and commitments affecting the
financial position of the Company between the end of financial year and the date of this
Report.
The Company has complied with Secretarial Standards issued by the
Institute of Company Secretaries of India on Meetings of the Board of Directors and
General Meetings.
Appreciation
Your Directors wish to place on record their appreciation of the
contribution made by the employees at all levels to the continued growth and prosperity of
your Company. Your Directors also wish to place on record their appreciation to the
shareholders, dealers, distributors, consumers, banks and other financial institutions for
their continued support.
| FOR AND ON BEHALF OF THE BOARD |
|
| Mumbai |
M B Parekh |
| Date : 18th May, 2022 |
Executive Chairman |