DEAR MEMBERS,
Your directors take immense pleasure in presenting to you the 31st Annual Report along
with the audited financial statements of your Company for the financial year ended on 31st
March 2023.
FINANCIAL PERFORMANCE SUMMARY:
The financial statements of the Company have been prepared in accordance with the
Indian Accounting Standards (IND AS) notified under the Companies (Indian
Accounting Standards) Rules, 2015 prescribed under Section 133 of the Companies Act, 2013.
The summary of the financial performance of your Company for the Financial Year ended
March 31, 2023 is highlighted below:
Rs. in lakh
Particular |
2022-23 |
2021-22 |
Revenue from operations |
24,618.88 |
17,410.12 |
Other Income |
107.91 |
458.70 |
Total Income |
24,726.79 |
17,868.81 |
Total Expenses |
23,629.88 |
16,836.75 |
Profit Before Tax |
1,096.91 |
1,032.06 |
Tax Expenses |
|
|
- Current Tax |
320.00 |
326.31 |
- Deferred Tax |
(69.43) |
(29.87) |
Profit After Tax |
846.34 |
735.62 |
Other Comprehensive income (net of tax) |
4.58 |
17.52 |
Total Comprehensive Income for the period / year |
850.92 |
753.15 |
Earning Per Equity Share (EPS) for the period (Face Value of 10) |
|
|
Basic |
8.03 |
6.86 |
Diluted |
8.03 |
6.86 |
REVIEW OF OPERATIONS:
The year under report did not start very well for your company this year. The 2022
season of exports of grapes was one of the worst seasons we have had in the last 10 years.
The sea freight was astronomically high. Ukraine-Russia war started in the middle of the
season and the Euro currency dropped significantly against the Indian Rupee. Fortunately,
the situation reversed during the 2023 season and we were able to recover in the last
quarter of this year. The processing business which is a year-round business assisted in
this recovery. Overall, the company delivered healthy revenue growth and was able to
maintain profitability amidst significant inflationary headwinds. During the year under
review the revenue of the Company increased from Rs. 17,410.12 Lakhs to Rs. 24,618.88
Lakhs, an increase of 41.41% and the profit after tax increased from Rs 735.62 Lakhs to
Rs. 846.34 Lakhs an increase of 15.05%. The increase in revenue was mainly due to very
high Sea freight rates in the first half of the year and the profitability was due to a
sudden fall in sea freight rates in the later part of the financial year. The currency
changes also assisted in improving profitability.
MANAGEMENT DISCUSSION AND ANALYSIS (MDA):
Pursuant to and in compliance with the provisions of Regulation 34(2)(e) of the Listing
Regulations, MDA for the Financial Year ended on March 31, 2023, the operating context and
the performance
highlights have been comprehensively discussed in Management Discussion and Analysis
Report forming an integral part of this Integrated Annual Report as Annexure
A.
TRANSFER TO RESERVES:
During the year under review, the entire amount of profits of Rs. 846.34 Lakhs for FY
2022-23 is transferred as retained earnings and not transferred to General Reserve.
DIVIDEND:
Your directors do not recommend any Dividend for the financial year ended on 31st March
2023 in order to conserve resources of the Company. The Company will retain the earnings
for use in future operations and projects and strive to increase the net worth of
Stakeholders of the Company.
DEPOSIT:
Your Company has not accepted any deposits covered under Chapter V of the Companies
Act, 2013,
i.e. within the meaning of Section 2(31) of the Companies Act, 2013 read with Rule 2(1
)(c) of the Companies (Acceptance of Deposits) Rules, 2014 and as such there are no such
overdue deposits outstanding as on 31st March, 2023.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the
best of their knowledge and ability, state the following:
a. That in the preparation of the annual financial statements, the applicable
accounting standards have been followed along with proper explanation relating to material
departures, if any.
b. That such accounting policies have been selected and applied consistently and
judgement and estimates have been made that are reasonable and prudent so as to give a
true and fair view of the state of affairs of the Company as of 31st March 2023 and of the
profit of the Company for the year ended on that date.
c. That proper and sufficient care has been taken 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.
d. That the annual financial statements have been prepared on a going concern basis.
e. That proper internal financial controls were in place and that the financial control
was adequate and were operating effectively.
f. That proper system to ensure compliance with the provisions of all applicable laws
were in place and were adequate and operating effectively.
SHARE CAPITAL:
Authorized Share Capital of the Company is Rs. 15,00,00,000/- (Rupees Fifteen Crore
Only) divided in to 1,50,00,000 (One Crore Fifty Lakh) Equity Shares of Rs. 10/- (Rupees
Ten only) each.
Issued, Subscribed and Paid-up share capital of the Company is Rs. 9,89,49,020/-
(Rupees Nine Crore Eighty-Nine Lakhs Forty-Nine Thousand Twenty only) divided into
98,94,902 (Ninety-Eight Lakh Ninety-Four Thousand Nine Hundred Two) Equity Shares of Rs.
10/- (Rupees Ten Only) each.
Buy Back of Securities
During the year, the Board of Directors of the Company at their meeting held on 7th
December 2022 had approved the Buy-back of fully paid-up equity shares having face value
of Rs. 10/- each from the members of the Company (except promoters, promoter group and
persons in control of the Company) at a price not exceeding Rs. 115/- per Equity Share
("Maximum Buyback Price") and for an aggregate amount not exceeding Rs. 800
Lakhs (Rupees Eight Hundred Lakhs only) being 9.89% of the total paid-up share capital and
free reserves of the Company based on the audited financial statements of the Company as
on March 31, 2022 (being the date of last audited financial statements of the Company)
from the open market through Stock Exchange mechanism, in accordance with the
provisions of SEBI (Buyback of Securities) Regulations, 2018 and the Companies Act,
2013 and Rules made thereunder ("Buyback") at the Maximum Buyback Price and for
the Maximum Buyback Size. The indicative maximum number of Equity Shares to be bought back
was to be 6,95,652 equity shares ("Maximum Buyback Shares") (comprising 6.51 %
of the paid-up capital). Under the Buyback, the Company approved to utilize at least 50%
of the amount earmarked as the maximum Buyback Size for the Buyback i.e., Rs. 400 lakhs
("Minimum Buyback Size").
Pursuant to the aforesaid Buyback offer, the Company has bought back 7,93,094 equity
shares at aggregate amount of Rs. 7,96,95,161/- at average price of Rs. 100.49 per equity
shares at the end of Buyback period. The Buyback period commenced from 20th December 2022
and ended on 7th February 2023. Post buyback, the paid-up capital of the Company stands
reduced to Rs. 9,89,49,020/- divided into 98,94,902 Equity shares of Rs. 10/- each.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
As at March 31, 2023, the Board consists of six directors comprising of one executive
Chairman and Managing Director, one Executive Whole-Time Director, one Non-Executive and
Non-Independent Director and three Non-Executive Independent Directors. Other statutory
details are provided in the Corporate Governance Report, which forms a part of this Annual
Report.
There was no change in the Directors of the Company during the year under review.
Moreover, the Company has appointed Ms. Kalpana Suman as Company Secretary and
Compliance Officer of the Company w.e.f. 1st June, 2023 in place of Mr. Rohit Rawat, who
has tendered his resignation as Company Secretary and Compliance Officer of the Company
w.e.f. 31st May, 2023.
Re-appointment
In accordance with the provisions of Companies Act, 2013 and Articles of Association of
the Company, Mrs. Nanita Ashok Motiani (DIN: 00787809) is liable to retire by rotation at
the ensuing Annual General Meeting of the Company and being eligible, offer herself for
re-appointment. The Board recommends the appointment of Mrs. Nanita Ashok Motiani as
Director of the Company retiring by rotation. Details of the proposal for the appointment
/ reappointment of Directors along with their shareholding in the Company as stipulated
under Secretarial Standard 2 and Regulation 36 of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, as amended, is mentioned in the Notice of the
Annual General Meeting.
Independent Directors
The Company has received necessary declarations from all the Independent Directors of
the Company confirming that they meet the criteria of independence prescribed under the
Act and the Listing Regulations.
The Independent Directors met once on 28th May, 2022, without the attendance of
Non-Independent Directors and members of the Management. The Independent Directors
reviewed the performance of non-independent directors and the Board as a whole; the
performance of the Chairperson of the Company, taking into account the views of Executive
Directors and Non-Executive Directors and assessed the quality, quantity and timeliness of
flow of information between the Company Management and the Board that is necessary for the
Board to effectively and reasonably perform their duties.
Regarding proficiency, the Company has adopted requisite steps towards the inclusion of
the names of all Independent Directors in the data bank maintained with the Indian
Institute of Corporate Affairs, Manesar (IICA'). Accordingly, all the Independent
Directors of the Company have registered themselves with IICA for the said purpose. In
terms of Section 150 of the Act read with the Companies (Appointment & Qualification
of Directors) Rules, 2014, as amended vide Notification No. GSR.774(E), dated 18.12.2020,
since all the Independent Directors of the Company have served as Directors for a period
of more than three (3) years on the Board of Listed Company as on the date of inclusion of
their names in the database except Mr. Ashok C. Murajani, they are not required to
undertake online proficiency self-assessment test. Moreover, Mr. Ashok C. Murajani has
informed the Company that he has successfully qualified the online proficiency
self-assessment test.
Familiarization Program for Independent Directors
All Independent Directors are familiarized with the Company, their roles, rights and
responsibilities, nature of the industry and operations of your Company. The Independent
Directors were regularly updated on the industry and market trends, plant processes and
the operational performance of the Company through presentations. In compliance with the
requirements of SEBI (Listing Obligations & Disclosure Requirements) Regulations,
2015, the Company has put in place a familiarization program for Independent Directors.
The details of familiarization programs are explained in the Corporate Governance Report.
Performance Evaluation
Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of the SEBI
(Listing Obligations & Disclosure Requirements) Regulations, 2015, the Board has
carried out an annual performance evaluation of its own performance, the Directors
individually as well as the evaluation of the working of Board Committees viz. Audit
Committee, Nomination & Remuneration Committee, Stakeholders' Relationship Committee.
The details of Board evaluation process have been provided under the Corporate Governance
Report.
Policy On Directors' Appointment and Remuneration
The Company's policy on directors' appointment, remuneration and other matters provided
in Section178 (3) of the Companies Act, 2013 is available on the website of the Company
i.e. www.freshtrop.com.
Number Of Board Meetings
The Board of Directors met 5 (five) times during the year on 28th May 2022, 9th August
2022, 14th November 2022, 7th December 2022, and 11th February 2023 during the year under
review. The details of Board meetings and the attendance of the Directors are provided in
the Corporate Governance Report which forms part of this Report.
The maximum interval between any two meetings was well within the maximum allowed gap
of 120 days.
Committees of the Board
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
4. Corporate Social Responsibility Committee
The details of the Committees along with their composition, number of meetings held and
attendance at the meetings are provided in the Corporate Governance Report.
VIGIL MECHANISM/WHISTLE BLOWER POLICY:
Vigil Mechanism/Whistle Blower Policy As per provisions of Section 177(9) of the
Companies Act, 2013 read with Regulation 22(1) of SEBI Listing Regulations, your Company
has adopted a Whistle Blower Policy, to provide a formal vigil mechanism to the Directors
and employees to report their grievances / concerns about instances of unethical behavior,
actual or suspected fraud or violation of Company's Code of Conduct. The Policy provides
for adequate safeguards against victimization of employees who avail of the mechanism and
also provides for direct access to the Chairman of the Audit Committee in certain cases.
It is affirmed that no personnel of your Company have been denied access to the Audit
Committee. The functioning of the vigil mechanism is reviewed by the Audit Committee from
time to time.
The details of the policy as well as its weblink are contained in the Corporate
Governance Report and website of the Company https://freshtrop.com/investors/#investor-relations.
INSURANCE:
The assets of the Company are adequately insured against the loss of fire and other
risks which are considered necessary by the management.
INFORMATION REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO:
The information relating to conservation of energy, technology absorption and Foreign
Exchange earnings and outgo as stipulated under Section 134(3)(m) of the Companies Act,
2013 read with the Companies (Accounts) Rules, 2014 is set out herewith as Annexure
B forming part of this report.
CORPORATE SOCIAL RESPONSIBILITY:
The details of Corporate Social Responsibility (CSR) carried out by the Company are
appended in the Annexure C to the Directors' Report.
The particulars of the CSR committee constituted by the Company pursuant to the
provisions of Section 135 of the Companies Act, 2013 and the Rules forming part of the
same are included in the Corporate Governance Report annexed and form part of this Annual
Report.
MAINTENANCE OF COST RECORDS:
The provisions pertaining to maintenance of Cost Records as specified by the Central
Government under sub-section (1) of Section 148 of the Companies Act, 2013, are not
applicable to the Company.
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY:
The Company has an Internal Control System, commensurate with the size, scale and
complexity of its operations. The scope of the audit activity is broadly guided by the
annual audit plan approved by the top management and audit committee. The Internal
Auditors routinely test these systems and significant audit observations, if any, and
follow up actions thereon are reported to the Audit Committee. The Company has in place
adequate internal financial controls with reference to financial statements
CORPORATE GOVARNANCE:
A separate report on Corporate Governance compliance as stipulated by Listing
Regulations forms part of this Annual Report along with the required Certificate as ANNEXURE
I from a Practicing Company Secretary regarding compliance of the conditions of
Corporate Governance as stipulated as Annexure D.
In compliance with Corporate Governance requirements, your Company has formulated and
implemented a Code of Business Conduct and Ethics for all Board members and senior
management personnel of the Company, who have affirmed the compliance thereto.
The Compliance Certificate from Managing Director and Chief financial Officers as
required under regulation 17(8) of SEBI (LODR)2015 is annexed as Annexure II.
CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS:
In accordance with the SEBI (LODR) (Amendment) Regulations, 2018; a certificate has
been received from M/s. Manoj Hurkat & Associates, Practicing Company Secretaries,
that none of the Directors on the Board of the Company has been disqualified or debarred
to act as Director. The same is annexed as Annexure E to the directors'
report.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF):
In accordance with the applicable provisions of Companies Act, 2013 (hereinafter
referred to as the Act) read with Investor Education and Protection Fund
(Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as the
IEPF Rules), all dividends which are unclaimed or unpaid for a period of more
than 7 years, from the date of transfer of the same into unpaid/unclaimed dividend account
and shares pertaining to it, are required to transfer into demat account of iepf authority
therefor to comply with the said requirement the company has transferred the unpaid/
unclaimed dividend, declared in the FY 2014-15, amounting to Rs. 3,62,990/- and 15,168
shares on 29/11/2022 and 26/11/2022 respectively.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
Pursuant to Section 186 of the Companies Act, 2013 disclosure on particulars relating
to Loans, Advances, Guarantees and Investments are provided as part of the financial
statements.
CERTIFICATION AND RECOGNITION:
During the year under review, the Company has obtained the following certifications
pertaining to the
Highest International Standard of Food Safety and Hygiene:
1. ISO 22000 - ISO 22000 - is international standard developed by the International
Organization for Standardization dealing with food safety, it is systematic and proactive
approach to identification of food safety hazards, development and implementation of
control measures.
2. SGF International E.V. - This certifies participation of the Company voluntary
self-control safe guide in the fruit juice segment for enhancing customer and consumer
safety.
3. SEDEX (Supplier Ethical Data Exchange) - SEDEX is world's largest collaborative
platforms for sharing responsible sourcing data on supply chains; the company is member of
SEDEX.
4. Halal Certificate - Halal Products are "universal" products not only
suitable for Muslims consumption, but it is also ensuring the safety of nation's food
supply and we acquired this certificate to export our products in Islamic Countries.
5. BRC Certificate - the BRC certificate for Food Safety as requirements of the EU
General Product Safety, the BRC certificate is for Nashik (Unit I) Pack house and Sangli
(Unit II) Pack house.
6. FDA - The Food and Drug Administration ensuring the safety of food supply in US
Market.
7. APEDA Pack House - The APEDA Recognition for pack house will be granted for
multiple produce for which appropriate facilities and procedural compliances as per the
importing countries. APEDA Pack house has Recognition for Nashik (Unit I) and Sangli (Unit
II) as Pack house.
8. Global GAP Certificate - it is a voluntary set worldwide standard for
agriculture producer for adoption of safe and sustainable practices.
9. Walmart Supply Chain Security - is the accumulation of controls throughout the
supply chain process that enhance the security of the supply chain during the
transportation of finished, we follow the same for Unit I and Unit II.
10. Fairtrade Certificate - Fair trade is an alternative approach to conventional
trade based on a partnership between producers and traders, businesses, and consumers.
11. FSSAI License - Food Safety and Standards Authority of India, is the food
regulatory body of India, The FSSAI registration becomes mandatory in order to ensure
safe, and smooth operations of the food business. FSSAI food license helps the government,
as well as the consumers, feel assured that the regulation of the storage, production,
distribution, and the sales has been carried out in a way that the food products are fit
for consumption. FSSAI License is for Nasik (Unit I) Pack house and Sangli (Unit II) Pack
house and Nashik processing unit (Unit IV).
12. Amfori BSCI - The Amfori BSCI is based on the labor standards of the
International Labour Organization (ILO) as well as on national regulations. This
initiative aims at continuously improving the social performance of suppliers, ultimately
enhancing working conditions in factories worldwide.
13. Two Star Export House - Export House Status Holders are business leaders who
have excelled in international trade and have successfully contributed to the country's
foreign trade. Status Holders are expected to contribute to India's exports and provide
guidance and handholding to new entrepreneurs.
14. AEO Certification - The AEO Certification enables Customs administration to
identify the safe and compliant business entity to provide them a higher degree of assured
facilitation. This segmentation method enables Customs resources to focus on less
non-compliant or risky businesses for control. Thus, the AEO certification intends to
secure the international supply
chain by permitting recognition to trustworthy operators and encouraging best practices
at all levels in the international supply chain.
PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 of the Companies Act, 2013 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 Companies Act, 2013, the Report 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 Office of the Company during
business hours on working days of the Company upto the date of the ensuing Annual General
Meeting. If any member is interested in inspecting the same, such member may write to the
Company Secretary in advance.
AUDITORS' & AUDITORS' REPORT:
A) STATUTORY AUDITOR :
Pursuant to the provisions of Section 139 of the Act read with Rules made thereunder,
as amended from time to time, M/s F P & Associates, Chartered Accountants (Firm
Registration Number - 0143262W), the Auditor were appointed as statutory
auditors of the Company for second term of 5 years at the 30th AGM held on 26th September
2022, from the conclusion of that 30th AGM till the conclusion of the 35th Annual General
meeting of the company on such remuneration (including fees for certification) and
reimbursement of out of pocket expenses for the purpose of audit as may be fixed by the
Chairman and Managing Director of the Company in consultation with the said Statutory
Auditor.
Notes to the financial statements referred in the Auditors Report are self-explanatory
and therefore do not call for any comments under Section 134 of the Act. The Auditors'
Report is enclosed with the financial statements in this Annual Report.
No fraud has been reported by the Auditor under Section 143(12) of the Companies Act,
2013 requiring disclosure in the Board's Report.
B) SECRETARIAL AUDITOR:
Pursuant to the provisions of Section 204 of the Act read with the Rules made
thereunder, your Company had appointed Mr. Manoj Hurkat, Practicing Company Secretary to
undertake the Secretarial Audit of the Company. The Secretarial Audit Report for financial
year 2022-23 is annexed which forms part of this report as Annexure F.
There were no qualifications, reservation or adverse remarks in the Secretarial Audit
Report of the Company for the FY
2022- 23.
C) INTERNAL AUDITOR:
Your Company has re-appointed Mr. Kalpesh Parikh as Internal Auditors of the Company to
carry out the internal audit of various operational areas of the Company for the financial
year
2023- 24.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE:
As per the requirement, The Sexual Harassment of Women at Workplace (Prevention,
Prohibition & Redressal) Act, 2013 read with rules made thereunder, Your Company has
constituted Internal Complaints Committee which is responsible for redressal of complaints
related to sexual harassment. During the year under review, there were no complaints
pertaining to sexual harassment. The Company is compliant of all applicable provisions of
the said Act.
ANNUAL RETURN:
Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act read with
the Rules made thereunder, the Annual Return in form MGT-7 as on 31 March 2023 is
available on the Company's website at https://freshtrop.com/investors/ -
b3fc28860a2ba15b4.
RELATED PARTY TRANSACTIONS:
All the related party transactions entered into during the financial year 2022-23 were
on an arm's
length basis and were in the ordinary course of business. Your Company has not entered
into any transactions with related parties which could be considered material in terms of
Section 188 of the Companies Act, 2013. Accordingly, the disclosure of related party
transactions as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC 2
is not applicable.
RISK MANAGEMENT POLICY:
The Company has a Risk Management Policy to ensure appropriate risk management within
its systems and culture. The Board of Directors and the Audit Committee of the Company
periodically reviews the Risk Management Policy of the Company. The provisions of
Regulation 21 of SEBI (LODR) Regulations, 2015 relating to Risk Management Committee are
not applicable to the Company.
DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR
TRIBUNAL:
There are no significant and material orders passed during the year by the regulators
or courts or tribunals impacting the going concern status of the Company and operations of
the Company in future.
COMPLIANCE OF APPLICABLE SECRETARIAL STANDARDS:
During the year under review, your Company has complied with all the applicable
Secretarial Standards with respect to Board and General Meeting issued by the Institute of
Company Secretaries of India (ICSI).
ACKNOWLEDGMENT:
Your directors place on records their appreciation of the sincere and devoted services,
rendered by all employees of the company and the continued support and confidence of the
customers. The Board expresses special thanks to progressive farmers of Maharashtra who
have worked hard to achieve International Standards in the quality of their produce. The
Board also expresses its sincere thanks to Axis Bank Ltd, CITI Bank and their officers,
Agricultural and Processed Food Products Export Development Authority (APEDA), Ministry of
Food Processing Industry (MFPI) and all other well- wishers, for their timely support.
Date: 11th August 2023, |
By order of the Board |
|
For Freshtrop Fruits Limited |
Registered Office |
|
A-603, Shapath IV, |
Ashok Motiani |
Opp. Karnavati Club, S. G. Road, |
Chairman & Managing Director |
Ahmedabad - 380015 |
(DIN: 00124470) |