Your directors present before you the 45th Annual Report of your Company on business & operations together with Audited Financial Statements and the Auditor's Report for the year ending 31st March 2024.
OPERATIONS
During the year under review, the Company's sales were Rs. 473.25 crores (including exports of Rs. 66.67 crores) against sales of Rs. 543.20 crores (including exports of Rs. 103.56 crores) during the previous year. The production was lower at 45043 M.T. against 47214 M.T. Margins were under pressure as raw jute prices remained abnormally high, production and productivity are lower.
The Cabinet Committee on Economic Affairs chaired by the Prime Minister Shri Narendra Modi, has given its approval for the Minimum Support Prices (MSP) for Raw Jute for 2024-25 season. The MSP of Raw Jute (TDN-3 equivalent to earlier TD-5 grade) has been fixed at Rs. 5,335/- per quintal for 2024-25 season.
The jute industry is faced with a crisis following reduced orders from customers, particularly significantly reduced orders for GBT (Gunny Burlap Textile) bags by the Food Corporation of India (FCI) and State Procuring Agencies (SPAs). Prices of raw jute have plummeted below Rs 5,000 per quintal, while the Minimum Support Price (MSP) is Rs 5,335 per quintal for the 2024-25 season. This is not good for the industry as farmers are likely to be disenchanted with growing Jute. Particularly so as this alarming drop in prices has occurred despite projections of substantially reduced production by the Expert Committee on Jute (ECJ).
FINANCIAL SUMMARY (Rs. in Crores)
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Particulars
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2023-24
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2022-23
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Total Income
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476.18
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547.51
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Profit before Depreciation, Finance Costs, Tax and Exceptional Items
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0.91
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17.93
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Finance Costs
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9.89
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(7.39)
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Depreciation and Amortization
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8.88
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(8.43)
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Exceptional items
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-
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-
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Profit before tax
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(17.86)
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2.11
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Tax expenses
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5.32
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0.77
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Profit for the Year
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(12.54)
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1.34
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Other Comprehensive income for the year, net of tax
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2.20
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2.11
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Total Comprehensive income for the year
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(10.34)
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3.45
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DIVIDEND
The Board of Directors have not recommended dividend on equity shares for the financial year ended 31st March 2024.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of Section 124(5) of the Companies Act, 2013, dividend which remains unpaid or unclaimed for a period of seven years from the date of its transfer to unpaid dividend is required to be transferred by the Company to Investor Education and Protection Fund (IEPF), established by the Central Government under the provisions of Section 125 of the Companies Act, 2013. The amount transferred to IEPF was Rs. 8,88,750/- during the year 2023-24.
TRANSFER TO RESERVES
The Company has not transferred any amount to General Reserves during the current year.
BOARD MEETINGS
The Board of Directors met 5 (Five) times i.e., 02.05.2023, 14.06.2023, 04.08.2023, 07.11.2023 & 23.01.2024 during this financial year. The maximum time interval between any two meetings was within the maximum time allowed pursuant to the Companies Act, 2013 and SEBI Regulations. The details and number of meetings attended by Directors forms part of Corporate Governance Report.
SUBSIDIARY COMPANY
The Company has no subsidiary, joint venture, or associate Companies.
PUBLIC DEPOSIT
Your Company has not accepted any deposits from public in terms of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.
INTERNAL FINANCIAL CONTROL
The Board of Directors confirm that all the systems, policies, procedures and frameworks, which are currently operational within the Company are adequate for ensuring the orderly and efficient conduct of its business and adherence to the laws. They are in line with the best practices to the extent applicable to the company. The Audit Committee and the Board reviews internal control systems to ensure that they remain effective and are achieving their intended purpose. Weaknesses, if any, are identified and new procedures are put in place to strengthen controls.
The Company has also appointed an Internal Auditor as per the provisions of the Companies Act, 2013. The Company's internal audit process covers all significant operational areas and reviews the Process and Control. The Internal Auditor has authority to verify whether the policies and procedures, including financial transactions, are carried out in accordance with defined processes and variations and exceptions (if any) are justified and reported properly.
CREDIT RATING
CARE Ratings Limited has assigned long-term rating of CARE BBB; Stable and short-term rating of CARE A3 to the Company for the working capital and term loan facilities availed by the Company.
CHANGE IN NATURE OF BUSINESS, IF ANY
There has been no change in the nature of business of the company during the year under review and the Company continues to carry on its existing business.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Tonmoy Bera (DIN: 08342972), resigned from the Board in the capacity of Executive Managing Director w.e.f. 12th June, 2023.
Mr. Ashish Chandrakant Agrawal (DIN: 10198821) was appointed as Managing Director w.e.f. 14th June 2023 at their Board Meeting held on 14th June 2023 which was further approved by shareholders at their Annual General Meeting held on 11th September 2023.
In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company Mr. Rajya Vardhan Kanoria (DIN: 00003792), Director of the Company retires by rotation at the conclusion of the forthcoming Annual General Meeting, and being eligible offers himself for reappointment.
Mr. Jugal Kishore Bhagat (DIN: 00055972) & Mr. Satish Kapur (DIN: 00051163) was appointed as an Independent Director for second term of 5 years in the Annual General Meeting held on 4th September 2019 and their term shall expire on the forthcoming Annual General Meeting.
None of the Directors of the Company are disqualified for being appointed as a Director, as specified in Section 164(2) of the Companies Act, 2013.
I. Declaration from Independent Directors
The Company has received necessary declarations from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that they meet the criteria of Independence laid down in Section 149(6) of the Companies Act, 2013 & Regulation 16(1)(b) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.
II. Nomination and Remuneration Policy
The Company follows a policy on Nomination and Remuneration of Directors and Senior Management Employees. The policy has been prepared pursuant to the provisions of Section 178(3) of the Companies Act, 2013, Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Nomination and Remuneration Committee reviews the composition and diversity of the Board, keeping in view the requirements of Companies Act, 2013 and SEBI (LODR) Regulations, 2015 recommends to the Board, appointment/re-appointment of eligible personnel including their terms of appointment and remuneration. The Nomination and Remuneration Policy including criteria for determining qualifications, positive attributes and independence of a director has been formulated. The said policy may be referred to on the Company's website i.e., www.ludlowjute.com.
The performance of the Board has been evaluated as per the policy laid down in that regard.
III. Ratio of Remuneration of each Director
Details of Ratio of Remuneration of each Director to the median employee's remuneration is annexed as Annexure - III, forming part of this Report.
AUDITORS
(i) Statutory Auditors
M/s. J K V S & Co., Chartered Accountants, (Firm Registration No. 318086E) was re-appointed as Statutory Auditor of the Company for a term of 5 years in their Annual General Meeting held on 28th September 2022.
The Statutory Auditors have confirmed their eligibility and submitted a written certificate stating that they are qualified to hold the office of the Statutory Auditor. Their report on the financial statements of the Company is included in the Annual Report, and there are no qualifications, reservations, or adverse remarks given by the statutory auditor in their report.
(ii) Cost Auditors
Pursuant to Section 148 of the Act, the Board, on the recommendation of the Audit Committee, has approved the appointment of M/s SPK Associates, Cost Accountants (Firm Registration No. 000040), Kolkata, as the Cost Auditors for conducting the audit of the cost records of the Company for the financial year ending on 31 March 2025, at a remuneration of Rs. 40,000/- (Rupees Forty Thousand Only) plus taxes and reimbursement of travelling and other incidental expenses, subject to approval of shareholders, as may be incurred in connection with the Cost Audit of the Company."
(iii) Secretarial Auditor
Pursuant to Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed Mr. Sachin Kumar, (ACS - 14157) Practising Company Secretary to conduct Secretarial Audit of the Company for the financial year 2023-24. The Secretarial Audit Report for the financial year 2023-24 is provided as an Annexure to this Report in Annexure - II. The Report does not contain any qualification, reservation or adverse remark.
FRAUD REPORTING
During the year under review, the Auditors have not reported any matter under section 143(12) of the Companies Act, 2013, therefore no details is required to be disclosed under Section 134(3) of the Companies Act, 2013.
CORPORATE GOVERNANCE
The Company has complied with the corporate governance requirements under the Companies Act, 2013 and Regulation 34 (3) read with Schedule V under the SEBI (Listing Obligations & Disclosure Requirements), Regulations 2015, a separate section on corporate governance along with a certificate from the statutory auditors of the Company confirming the compliance, is annexed and forms part of this Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under Regulation 34(2)(e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed and forms part of this Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 of the Companies Act, 2013, with respect to Directors' Responsibility Statement, it is hereby confirmed:
(i) That in the preparation of the annual accounts for the financial year ended 31st March, 2024, the applicable Indian Accounting Standards (Ind AS) had been followed;
(ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were responsible 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/loss of the Company for that period;
(iii) That the Directors 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;
(iv) That the Directors have prepared the accounts for the financial year ended 31st March, 2024, on 'a going concern' basis;
(v) That 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;
(vi) That 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.
RISK AND MITIGATING STEPS
The Company has identified various risks faced from different areas. As required under the SEBI (Listing Obligations & Disclosure Requirements), Regulations 2015, the Board has adopted a Risk Management Policy whereby a proper framework is set up. Appropriate structures are present so that risks are inherently monitored and controlled. A combination of policies and procedures attempts to counter risk as and when they evolve.
The Company has also formed a Risk Management Committee which monitors the risk elements and mitigation procedures at periodical intervals. The constitution and terms of reference are set out in details in the Corporate Governance Report. The risks and its mitigating factors are discussed by the Committee and subsequently placed before the Board.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO
Information in accordance with the provisions of Section 134(3)(m) of the Companies Act 2013, read with Rule 8 of the Companies (Accounts) Rules 2014, regarding conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed as Annexure - I, forming part of this Report.
AUDIT COMMITTEE
The Audit Committee of the Board has been constituted in terms of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Section 177 of the Companies Act, 2013. The constitution and other details of the Audit Committee are given in the Corporate Governance Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Corporate Social Responsibility Committee of the Board has been constituted as per Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014. The constitution and other details of the Corporate Social Responsibility Committee are given in the Corporate Governance Report. The said policy may be referred to on the Company's website i.e., www. ludlowjute.com.
As per Section 135(1) of the Companies Act, 2013 ('the Act') CSR provisions are applicable to every company having net worth of Rs. 500 crores or more, or turnover of Rs. 1000 crores or more or a net profit of Rs. 5 crore or more in the immediately preceding financial year. The Company in the financial year ended 31st March 2023 did not fulfill any such criteria and hence CSR was not applicable for the year.
However, the Company wishes to inform the members that Rs. 5.06 Lakhs have been spent by the Company as CSR expenditure.
PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS
The Company has not given any loan, guarantee or made any investments exceeding sixty per cent of its paid-up share capital, free reserve and securities premium account or one hundred per cent of its free reserves and securities premium account, whichever is more, as prescribed in Section 186 of the Companies Act, 2013.
PARTICULARS OF CONTRACTS OR ARRANGENMENTS WITH RELATED PARTY
A Related Party Policy has been devised by the Board of Directors for determining the materiality of transactions with related parties and dealings with them. The said policy may be referred to at the website of the Company i.e., www.ludlowjute.com. The Audit Committee reviews all related party transactions quarterly. Necessary approval of the Audit Committee and the Board of Directors were taken as and when required.
Further the members may note that the Company had entered into the following related party transactions at arm's length price:
• Property taken on lease from Kirtivardhan Finvest Services Limited.
• Availing of services like maintenance, upkeep, allied services and facilities, amenities, etc., from Belvedere Gardens Limited.
• Intercorporate Loan from R V Investment & Dealers Limited.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Pursuant to the provision of Section 177(9) & (10) of the Companies act, 2013, a Vigil Mechanism/Whistle Blower Policy has been formulated by the Company for its Directors and Employees. The policy allows intimation by affected persons in good faith of any concern or misconduct through a written communication. The Policy assures adequate safeguard against victimization of employees and directors who avail of the vigil mechanism policy. It also provides for action against frivolous complaints. The Audit Committee oversees the Vigil Mechanism for disposal of the complaints. The said policy may be referred to on the Company's website i.e., www.ludlowjute.com.
PARTICULARS OF EMPLOYEES
No employee of the Company was in receipt of remuneration exceeding the limit as prescribed under Section 134 of the Companies Act, 2013.
SIGNIFICANT AND MATERIAL ORDERS BY THE REGULATORS / COURTS / TRIBUNAL IMPACTING THE COMPANY'S GOING CONCERN STATUS & OPERATIONS IN FUTURE
During the period under review, no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in the future.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has complied with Secretarial Standards issued by The Institute of Company Secretaries of India.
ENVIRONMENT AND SAFETY
Green business practices are the buzzword today. Your Company firmly believes in environment protection and conservation of natural resources to the extent possible. We have taken initiatives to produce eco-friendly products while complying with environment and pollution standards. Safety, in all aspects of manufacturing, is given full attention by the Company. As mentioned earlier the management and employees rose to the occasion and ensured a disciplined and organised system to keep our workplace safe.
The Company is also certified under ISO 14001:2004 for its Environmental Management Systems.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
The Company's policy on prevention of sexual harassment of women provides for the protection of women employees at the workplace and for prevention and redressal of such complaints. There were no complaints pending for the redressal at the beginning of the year and no complaints received during the financial year.
ANNUAL RETURN
In compliance with Section 134(3) (a) of the Companies Act, 2013 Annual Return of the Company is available on Company's Website i.e., www.ludlowjute.com
HUMAN RESOURCES DEVELOPMENT AND INDUSTRIAL RELATIONS
The Company's human resources development is founded on a strong set of values. The policies seek to instil spirit of trust, transparency, and dignity among all employees. The Company continues to provide ongoing training to its employees at different levels.
Industrial relations with employees and workers across all locations of the Company continued to be cordial during the year.
APPRECIATION
Your directors take this opportunity to express their grateful appreciation for the co-operation and guidance received from the Regulators, Central & State Govts., Bankers as well as the Shareholders during the year. Your directors also wish to place on record their appreciation for the devoted and dedicated service rendered by all the employees of the Company.
For and on behalf of the Board For and on behalf of the Board
Rajya Vardhan Kanoria Ashish Chandrakant Agrawal
Date: 6th August 2024 Chairman Managing Director
Place: Kolkata DIN: 00003792 DIN: 10198821
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