Dear Shareholders,
Your Directors are pleased to present the 16th ANNUAL REPORT
of the Company together with the Audited Financial Statements for the Financial Year ended
31 March 2023.
FINANCIAL PERFORMANCE
( in lakhs)
|
Standalone |
Consolidated |
Particulars |
|
|
|
|
|
FY 2022-23 |
FY 2021-22 |
FY 2022-23 |
FY 2021-22 |
Income from Operations |
11,674.81 |
11,601.20 |
21,055.54 |
18,559.41 |
Other income |
41.81 |
4.03 |
37.82 |
1.68 |
Total income |
11,716.62 |
11,605.23 |
21,093.35 |
18,561.09 |
Total Expenditure |
10,500.76 |
10,919.34 |
18,277.00 |
16,716.64 |
Profit Before Tax (PBT) |
1,215.86 |
685.89 |
2,816.36 |
1,844.44 |
Less: Tax expenses |
373.4 |
181.81 |
767.4 |
475.51 |
Profit After Tax (PAT) |
842.46 |
504.08 |
2,048.95 |
1,368.93 |
EPS in (Basic & Diluted) |
1.34 |
0.80 |
3.27 |
2.18 |
Financial statements are prepared in accordance with the Indian
Accounting Standards (lnd-AS) as prescribed under Section 133 of the Companies Act, 2013
read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 20 15 and Companies
(Indian Accounting Standards) Amendment Rules, 2016
COMPANY PERFORMANCE / STATE OF AFFAIRS
During the year, revenue from operation of your Company was 11,674.81
Lakhs as compared to 11,601.20 Lakhs in the previous year and the net profit has grown by
67% to 842.46 Lakhs as against 504.08 Lakhs in the previous year.
CHANGE IN THE NATURE OF BUSINESS
Your Company is engaged is the business of manufacturing Agro products
for Crop protection and crop nutrition.
There was no change in the nature of the business during the financial
year under review, except the change in object clause of the Company, as
mentioned below:
Alternation of main objects:
Your Company has inserted 3 (three) new objectives in the Main Objects
of the Memorandum of Association of the Company in order to enlarge the area of operations
and carry on its business economically and efficiently and the proposed activities can be,
under the existing circumstances, and advantageously combined with the present activities
of the Company, as approved by the shareholders in the Extra Ordinary General Meeting held
on 11 February 2023.
SUBSIDIARY COMPANIES/JOINT VENTURES/ASSOCIATE COMPANIES
Your Company has following subsidiaries as on 31 March, 2023:
S. no. |
Name of the Company |
Particular |
1) |
Nova Agri Sciences Private Limited CIN:
U01403TG2010PTC068405 |
Wholly owned Subsidiary
Company |
2) |
Nova Agri Seeds (India) Private Limited |
|
|
CIN: U01403TG2009PTC065732 |
|
3) |
Suraksha Agri Retails (India) Private Limited** |
Associate Company |
|
CIN: U01820TG2009PTC063119 |
|
**23.60 % stake is owned Suraksha in the Company
The statement required to be provided with respect to subsidiaries and
associate companies pursuant to the provisions of Section 129(3) of the Act and Rule 5 of
the Companies (Accounts) Rules, 2014 in Form AOC 1 is annexed herewith as Annexure
I.
The Audited Financial Statements, the Auditors Reports thereon and the
Board's Reports for the year ended 31 March, 2023, of the aforesaid companies, shall
be available for inspection by the Members at its registered office, during business hours
on all working days up to the date of the Annual General Meeting and the same are also
available on the website of the Company www.novaagri.in.
Note:
Your Company does not have any Joint Ventures.
No Company has become / ceased to be its Subsidiary, Joint Venture or
Associate of Company during the year under review.
Additionally, we would also like to inform that following Companies
shall fall under the purview of Group Companies pursuant to SEBI circular-
SEBI/ HO/ AFD/ AFD PoD 2/ CIR/ P/ 2023/ 148 dated 24 August, 2023:
S. No. |
Name of the Group Companies |
CIN |
1) |
Nova Ferticare Private Limited |
U24100TG2015PTC099837 |
2) |
Nova Dairy Tech India Private Limited |
U01119TG2013PTC087282 |
3) |
Nova Health Sciences Private Limited |
U85190TG2010PTC068584 |
4) |
Agri Genome Resources India Private Limited |
U01403TG2011PTC072116 |
5) |
AIC Nova Foundation for Agriculture
Innovation and Research |
U93090TG2018NPL128938 |
Material Subsidiary:
The Company has 1 (one) material subsidiaries as per the definition of
Regulation 16(1) (c) of SEBI (Listing Obligations and Disclosure Requirements)
Regulations. 2015.
1) Nova Agri Sciences Private Limited
CIN: U01403TG2010PTC068405
The Company's policy on determining the material subsidiaries is
uploaded on the Company's website at www.novaagri.in.
TRANSFERS TO RESERVES
During the year under review, the entire profit of 842.46 Lakhs for the
year ended 31 March 2023 was transferred to the surplus under Reserves and Surplus A/c. No
Amount was transferred to Reserves.
DIVIDEND
Considering your Company's growth, and future strategy and plans,
your Directors consider it prudent to conserve resources and despite having sufficient
distributable profits, do not recommend any dividend on equity shares for the financial
year under review.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION
FUND
During the year under review, the Company was not required to transfer
any unclaimed dividend to IEPF Account.
PUBLIC DEPOSITS
During the financial year 2022-23, your Company has not accepted any
deposit that falls within the scope of Sections 73 and 74 of the Companies Act, 2013, read
together with the Companies (Acceptance of Deposits) Rules, 2014. Further, there is no
amount outstanding at the beginning of financial year 2022-23, which can be classified as
Deposits' in terms of Section 73 of the Companies Act, 2013, read with
Companies (Acceptance of Deposit) Rules, 2014.
PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS UNDER SECTION 186
The loans granted, guarantees given and investments made are in
compliance with Section 186 of the Companies Act, 2013. As per the requirements of Section
186 and Section 134(3)(g) of the Companies Act, 2013, we would like to inform that details
of loans, guarantees, securities and investments made by the Company, are provided in the
notes to the financial statements forming part of the Annual Report.
SHARE CAPITAL
Authorized Share |
20,00,00,000/- divided into 10,00,00,000
equity shares of 2/- each |
Capital |
|
Subscribed, Issued and |
13,04,05,480/- divided into 6,52,02,740
equity shares of 2/- each |
Paid-up Capital |
|
[as on 31 March 2023]
During the financial year under review, there were following changes:
Allotment of Shares:
Company has allotted 5,00,000 equity shares of 10/- each to Nova
Agritech Limited Employees Welfare Trust on 06 January 2023 pursuant to Nova
Agri Tech Limited Share-based Employee Benefit Scheme 2022 (ESOP Scheme)
implemented pursuant to approval of the Board of Directors and Shareholders in their
respective meetings held on 23 November 2022 and 19 December 2022 respectively.
Accordingly, the paid-up share Capital of the Company has increased
from 12,54,05,480/- (Rupees Twelve Crore Fifty Four Lakhs Five Thousand Four Hundred and
Eighty Only) to 13,04,05,480/- (Rupees Thirteen Crores Four Lakhs Five Thousand Four
Hundred and Eighty Only).
Split of Shares:
Company has sub divided 1 (one) equity Share of 10/- each of the
Company into 5 (five) equity shares of 2/- each (1:5 ratio) pursuant to approval of the
Board of Directors and Shareholders in their respective meetings held on 18 January 2023
and 11 February 2023.
Accordingly, 1,30,40,548 equity shares of your Company of face value of
10/- each were sub-divided into 65,202,740 Equity Shares of face value of 2/- each.
However, there is no change in Shareholding pattern or Paid up capital
of the Company in lieu of the aforesaid share split.
PROPOSED LISTING/ IPO
Your Company has filed Draft Red Herring Prospectus (DRHP)
with Securities Exchange Board of India (SEBI) on 03 March 2023 proposing
listing of its equity shares on BSE Limited and National Stock Exchange of India Limited.
Through such Initial Public Offer (IPO), your Company proposes to raise additional fund of
140 Crores through Fresh Offer.
Further, existing shareholder of the Company namely Mr. Nutalapati
Venkatasubbarao proposes to dilute his stake in the Company by disposing 77,58,620 Equity
shares of 2/- each through IPO in Offer for sale category.
Utilization of Fund:
Proposed public issue is with a view to utilize the funds for setting
up a new formulation plant for the subsidiary Nova Agri Sciences Private Limited and for
the expansion of the existing formulation plant. The funds are also used for working
capital requirements, besides general corporate purposes. The DRHP submitted by the
Company is available at the website of the Company www.novaagri.in.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Particulars of contracts or arrangements entered by the Company with
related parties referred to in Section 188(1) are furnished under Form AOC-2 as
Annexure II.
Employee Stock Option Scheme (ESOP)
During the year under review, Your Company had implemented Nova
Agritech Limited Share Based Employee Benefit Scheme 2022 (hereinafter referred to
as the Scheme) to create, issue, offer, grant, allot and/or transfer from time
to time, upto a maximum of 5,00,000 (Five Lakh) Options /SARs/Shares or any other benefits
that may be granted pursuant to the Scheme, in one or more tranches which shall be
convertible into equitable number of Equity Shares of 10/- (Rupees Ten) each, unless
otherwise determined by the Compensation Committee as constituted by the Board, through
Nova Agritech Limited Employees Welfare Trust, a trust established by the
Company for implementation and/or administration of the Scheme (hereinafter referred to as
Trust), at such price or prices, in one or more tranches and on such terms and
conditions, as may be determined by the Board in accordance with the provisions of the
Scheme, SEBI (SBEBASE) Regulations, 2021.
Pursuant to the aforesaid scheme, the Company allotted 5,00,000 equity
shares of 10/- (Rupees Ten Only) each at a price of 25/- (including premium of 15/- per
share) to Nova Agritech Limited Employees Welfare Trust on 06 January 2023.
However, pursuant to sub-division of equity shares, the holding of Nova Agritech
Limited Employees Welfare Trust as on 31 March 2023 has tantamount to 25,00,000
Equity Shares of face value of 2/- each.
Disclosures in respect of Voting Rights not directly exercised by
Employees:
Pursuant to Nova Agritech Limited Share Based Employee Benefit
Scheme 2022 (Scheme), Nova Agritech Limited Employees Welfare Trust
holds 25,00,000 equity shares of 2/- each in the Company for the benefit of employees.
However, your Company has not granted any ESOPs to employees during the
period under review, and accordingly, No disclosures as required under Rule 16(4) of the
Companies (Share Capital and Debentures), 2014 has been furnished.
AMENDMENT OF MOA & ADOPTION OF NEW SET OF AOA
During the year, the Memorandum of Association (MOA) was amended vide
the resolution passed by Board of Directors dated 18 January 2023 and Shareholders dated
11 February 2023, to reflect
(a) Sub-division in authorized share capital from 20,00,00,000/-
divided into 2,00,00,000 Equity Shares of 10/- each to 20,00,00,000/- divided in
10,00,00,000 Equity Shares of 2/- each in Clause V of the MOA of the Company. (b)
Insertion of new sub-clauses 3, 4 and 5 after sub-clause 2 of Clause III (A) of the Main
Objects of the MOA of the Company.
During the year, the Company adopted new set of Articles of Association
(AOA) of the Company vide the resolution passed by Board of Directors dated 18 January
2023 and Shareholders dated 11 February 2023, in substitution and suppression of the
existing Articles of the Company.
MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL
Board of Directors
As on 31 March 2023, the Board comprised of 4 (four) Executive
Directors and 4 (four) Non-Executive Independent Directors.
Chairperson
During the year under review, Mr. Adabala Seshagiri Rao, Non-Executive
Independent Director (DIN: 09608973) of the Company was elected as Chairperson of the
Company w.e.f. 23 November 2022.
Retirement by Rotation
In accordance with the provisions of Section 152(6) of the Companies
Act, 2013 read with the Articles of Association of the Company, at least 2/3rd of the
total number of Directors of a public company shall be liable to retire by rotation and
1/3rd of such Directors shall retire by rotation at every AGM, However, Independent
Directors are out of the ambit of retiring by rotation.
In accordance with the provisions of Section 152(6), the Board has
proposed Mrs. Malathi Siripurapu (DIN: 03033944) as the Director to Retire by
rotation in the 16th AGM.
Mrs. Malathi Siripurapu, Whole-Time-Director, retires by rotation in
the ensuing AGM and being eligible, offers himself for re-appointment. A resolution
seeking shareholders' approval for his reappointment, along with other required
details forms part of the Notice of the AGM.
Detailed information as required under Regulation 36(3) of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 is enclosed as
Annexure-A to the Notice of 16th AGM.
Appointment and Cessation
Directors and Key Managerial Personnel
During the year, there were following changes in Board composition:
1. Mr. Seshagiri Rao Adabala (DIN: 09608973) is appointed as
Non-Executive Independent Director of the Company w.e.f. 25 October 2022 for a term of 5
years in the ExtraOrdinary General Meeting of the Shareholders of the Company held on 25
October 2022. Further, he was also appointed as Chairperson of the Company w.e.f. 23
November 2022.
2. Mr. Ramesh Babu Nemani (DIN: 08089820) was appointment as
Non-Executive Independent Director w.e.f. 23 March 2022 for a term of 5 years is
regularized in the 15th AGM of the Company held on 30 September 2022
3. Mr. Sri Hari Rao Chaganti (DIN: 08729255), Non-Executive
Director of the Company resigned from the officer of directorship w.e.f. 23 November 2022
due to resignation.
Key Managerial Personnel:
During the year under review there were following changes in KMP:
1. Mrs. Bhargavi Kandula, resigned as Chief Financial Officer
(CFO) of the Company w.e.f. 16 December 2022.
2. Mr. Srinivas Kamoji Gunupudi was appointed as Chief Financial
Officer (CFO) of the Company w.e.f. 03 January 2023.
After 31 March 2023 and until the approval of this Directors'
Report, there were the following changes in Board composition:
Board of Directors in their meeting held on 2 September 2023,
recommended for re-appointment of Mrs. Malathi Siripurapu (DIN: 03033944) as
Whole-Time-Director of the Company for a period of 3 (three) years w.e.f. 16 March 2024,
Subject to approval of members of the Company in the ensuing shareholders meeting.
Appropriate resolutions for the re-appointment of Mrs. Malathi
Siripurapu as Whole-Time-Director are being moved at the ensuing 16th AGM,
which the Board of Directors recommends for your approval.
Detailed information as required under Regulation 36(3) of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 is enclosed as
Annexure-A to the Notice of 16th AGM.
Declaration by the Independent Directors
The Company has received declarations from each Independent Director
citing that he/she meets the criteria of independence laid down under Companies Act, 2013
and such other statutory requirements so as to continue as Independent Directors of the
Company.
Opinion of the Board:
The Board after taking these declarations/disclosures on record and
acknowledging the veracity of the same, concluded that Independent Directors of the
Company are of persons of integrity, eminent personalities and have expertise/ experience
in their respective fields/ professions.
These Directors meet the criteria of independence, and were selected
and appointed, based on well-defined selection criteria. The Nomination and Remuneration
Committee considers, inter alia, key qualifications, skills, expertise and competencies,
fulfilment of criteria for independence, while recommending to the Board, the candidature
for appointment as Independent Director, to enable the Board to discharge its functions
and duties, effectively.
Directors' Responsibility Statement
Your Directors would like to assure the members that the financial
statements for the year under review is as per the requirements of the Companies Act, 2013
and pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, to the
best of their knowledge and based on the information and explanations received from the
Company, your Directors confirm that:
i. in the preparation of the annual financial statements for the year
ended 31 March 2023, the applicable accounting standards have been followed and there are
no material departures;
ii. accounting policies have been selected and applied consistently and
judgments and estimates that are reasonable and prudent have been made, so as to give a
true and fair view of the state of affairs of the Company as at 31 March 2023 and of the
profit & loss of the Company for that period;
iii. proper and sufficient care have been taken for the maintenance of
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company, for preventing & detecting fraud and/or other irregularities;
iv. the annual accounts have been prepared on a going concern basis;
v. internal financial controls have been laid down by the Company and
that such internal financial controls are adequate and are operating effectively; and
vi. Proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems are adequate and operating
effectively.
Annual Evaluation of Individual Directors, Committees and Board
Pursuant to the provisions of the Companies Act, 2013, the Board
carried out annual performance evaluation of its own performance, the Directors
individually, as well as the evaluation of the working of its Audit Committee, Nomination
and Remuneration Committee, and Stakeholders' Relationship Committee.
The Board took into consideration inputs received from the Directors,
covering various aspects of the Board's functioning, such as adequacy of the composition
of the Board and its Committees, Board culture, execution and performance of specific
duties, obligations and governance.
A separate exercise was carried out to evaluate the performance of
individual Directors, including the Chairman of the Board, who were evaluated on
parameters such as level of engagement and contribution, independence of judgments,
safeguarding the interest of the Company and its minority shareholders etc.
The performance evaluation of the Independent Directors were carried
out by the entire Board and performance evaluation of the Chairman and Non-Independent
Directors was carried out by the Independent Directors. The Directors expressed their
satisfaction with the evaluation process.
Board Diversity
The Policy on Board Diversity of the Company devised by the Nomination
and Remuneration Committee and approved by the Board is disseminated on the website of the
Company www.novaagri.in.
Code of Conduct and Declaration on Code of Conduct
Your Company has laid down a Code of Conduct for all Board members,
Senior Management and Independent Directors of the Company, in line with the provisions of
SEBI LODR Regulations and the Act. The said Code of Conduct is available on the website of
the Company www.novaagri.in. Declaration in this regard forms part of the corporate
governance report.
COMMITTEES OF THE BOARD
As on 31 March 2023, the Board has six committees, (i) Audit Committee,
(ii) Nomination and Remuneration Committee, (iii) Stakeholders' Relationship
Committee, (iv) Risk Management
Committee, (v) IPO Committee and (vi)Corporate Social Responsibility
Committee which are constituted as per the provisions of the Companies Act, 2013.
The details of the above-mentioned committees are as follows:
Audit Committee
Audit Committee has been constituted in terms of Section 177 of
Companies Act, 2013 and in terms of Regulation 18 of SEBI (LODR) Regulations.
Composition of the Committee, its terms of reference, detail of
meetings and such other details are provided in the Report on Corporate Governance. All
the recommendations made by the Audit Committee were accepted by the Board of Directors.
Nomination and Remuneration Committee
Nomination and Remuneration Committee has been constituted in terms of
Section 178 of Companies Act, 2013 and in terms of Regulation 19 of SEBI (LODR)
Regulations.
Composition of the Nomination and Remuneration Committee, its terms of
reference, details of meetings and such other details are provided in the Report on
Corporate Governance. All the recommendations made by the Audit Committee were accepted by
the Board of Directors.
Stakeholders' Relationship Committee
Stakeholders' Relationship Committee is constituted in line with
the provisions of Regulation 20 of SEBI (LODR) Regulations and Section 178 of the Act.
Composition of the SRC, its terms of reference, details of the meeting
and such other details are provided in the Report on Corporate Governance annexed.
Risk Management Committee
The Risk Management Committee was constituted on 27 February 2023.
Composition of the Risk Management Committee, its terms of reference,
details of its meetings, and such other details are provided in the Report on Corporate
Governance annexed.
IPO Committee
The IPO Committee was constituted on 27 February 2023.
Composition of the IPO Committee, its terms of reference, details of
its meetings, and such other details are provided in the Report on Corporate Governance
annexed.
Corporate Social Responsibility Committee
CSR Committee is constituted in line with the provisions of Section 135
of the Act to formulate and recommend to the Board, CSR Policy indicating the activities
to be undertaken by the Company as specified in Schedule VII of the Act, to recommend the
amount of expenditure to be incurred on the activities mentioned in the CSR Policy, and to
monitor the CSR Policy.
The brief outline of the corporate social responsibility (CSR) policy
of the Company and the initiatives undertaken by the Company on CSR during the year are
set out in Annexure III of this report in the format prescribed in the
Companies (Corporate Social Responsibility Policy) Rules, 2014.
Composition of the committee, its terms of reference, details of the
meeting and such other details are provided in the Report on Corporate Governance annexed.
CSR Policy is made available on the website of the Company www.novaagri.in.
Establishment of Vigil Mechanism
The Company has adopted a Whistle Blower Policy, establishing a vigil
mechanism to provide a formal mechanism to the Directors and employees to report concern
about unethical behavior, actual or suspected fraud or violation of code of conduct and
ethics. It, also, provides for adequate safeguards against the victimization of employees,
who avail of the mechanism, and provides direct access to the chairman of the Audit
Committee in exceptional cases. The whistle-blower policy is available on the website of
the Company www.novaagri.in.
NO. OF BOARD MEETINGS HELD DURING THE YEAR
The Board of Directors duly met 13 (Thirteen) times during the F.Y.
2022-23. The Details are given in the Corporate Governance Report forming
party of the Annual Report. The gap between two Board Meetings has not exceeded 120 days.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
All Independent Directors inducted into the Board are provided an
orientation on Company structure and Board constitution and procedures, matters reserved
for the Board, and our major risks and risk management strategy.
The Company familiarizes the Independent Directors with the Company,
their roles, rights, responsibilities in the Company, nature of the industry in which the
Company operates, etc., through various interactions and an update on amendments or
regulatory requirements and changes is given as part of Board meetings and familiarization
programs.
Details of the familiarization programs of the Independent Directors
are available on the website of the Company www.novaagri.in.
STATUTORY AUDITORS
Pursuant to Section 139 and other applicable provisions of the
Companies Act, 2013, the Members at the 11th AGM of the Company held on 22
September 2018, had approved appointment of M/s NSVR & Associates LLP, Chartered
Accountants (Firm Registration No. 008801S/S200060), as the Statutory Auditors of the
Company, to hold office from the conclusion of the 11th AGM till the conclusion
of the ensuing AGM.
As the Auditor's term is expiring in this AGM, pursuant to the
provisions of Section 139 and 142 of the Companies, 2013, and the rules made thereunder,
including any statutory modification(s) or re-enactment(s) thereof for the time being in
force, the Board of Directors recommends for the re-appointment of M/s NSVR &
Associates LLP, Chartered Accountants (Firm Registration No. 008801S/S200060) as Statutory
Auditors of the Company for the second term of 5 years i.e. from the conclusion of 16th
Annual General Meeting of the Company to till the conclusion of 21st Annual
General Meeting to be held in the year 2028, to conduct statutory audit of the Company for
the financial years commencing from 2023-24 to 2027-28 at a remuneration as may be
determined and mutually agreed by the Board the Statutory Auditors.
M/s NSVR & Associates LLP, Chartered Accountants (Firm Registration
No. 008801S/S200060) have provided their consent vide letter dated 02 September 2023 and
confirmed their eligibility for the proposed appointment as Statutory Auditors of your
Company.
Appropriate resolutions is being moved at the ensuing 16th
AGM for reappointment of M/s NSVR & Associates LLP as Statutory Auditors of the
Company, which the Board of Directors recommends for your approval.
Replies to the audit remarks;
The Auditors Report for the financial year ended 31 March 2023 does not
contain any qualification, adverse remark or reservation and therefore, do not call for
any further explanation or comments from the Board under Section 134(3) of the Companies
Act, 2013.
Fraud reported by Auditors:
There are no frauds reported by auditors under sub-section (12) of
section 143.
COST AUDIT/ MAINTENANCE OF COST RECORDS
For the financial year 2022-23, your Company was required to maintain
cost records, as specified by the central government under sub-section (1) of section 148
of the Act, is in respect of the activities carried on by the Company and conduct Cost
Audit of the same.
During the Year, Pursuant to Section 148 of the Companies Act, 2013
read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the Board of
Directors of your Company upon recommendation of Audit Committee appointed MPR &
Associates, Cost Accountants, (Firm Registration No. 000413) as Cost Auditors in its
meeting held on 02 September 2023 to conduct audit the cost records of the Company for the
financial year 2023-2024 at an annual remuneration of 30,000/-.
Appropriate resolutions is being moved at the ensuing 16th
AGM for ratification of the aforesaid remuneration for the year 2023-24, which the Board
of Directors recommends for your approval.
SECRETARIAL AUDITORS:
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Company upon recommendation of Audit Committee, has appointed P. S. Rao & Associates,
Practicing Company Secretaries in its meeting dated 02 September 2023, to undertake the
secretarial audit of the Company.
Secretarial Audit Report for the year 2022-23 in Form MR-3
is annexed to this report as Annexure IV. The Secretarial Audit Report does
not contain any qualification, reservation or adverse remark.
INTERNAL AUDITORS
For the period under review, Internal Audit is not applicable to your
Company.
However, for the financial year 2023-24, the Board of Directors had,
upon recommendation of the Audit Committee, appointed M/s. V P S & ASSOCIATES (Firm
Reg. No. 009280S), Chartered Accountants, as the Internal Auditors of the Company in its
meeting 02 September 2023 in accordance with the provisions of Section 138 of the
Companies Act, 2013 read with Companies (Accounts) Rules, 2014.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company has adequate internal control systems and procedures,
designed to effectively control its operations. The internal control systems are designed
to ensure that the financial and other records are reliable for the preparation of
financial statements and for maintaining assets.
Your Company has well designed standard operating procedures (SOPs),
considering the essential components of internal control as stated in the Guidance Note on
Audit of Internal Controls over Financial Reporting, issued by the Institute of Chartered
Accountants of India. Internal Auditor conducts audit, covering a wide range of
operational matters and ensures compliance with specified standards.
The findings are reviewed by the top management and by the Audit
Committee of the Board of Directors. Based on the deliberations with Statutory Auditors to
ascertain their views on the financial statements, including the financial reporting
system and compliance to accounting policies and procedures, the Audit Committee was
satisfied with the adequacy and effectiveness of the internal controls and systems
followed by the Company.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF
THE COMPANY FROM THE END OF THE FINANCIAL YEAR AND TILL THE DATE OF THIS REPORT
No material change and commitment affecting the financial performance
of the Company which occurred between the end of the financial year of the Company to
which the financial statements relate and the date of this Report (i.e. from 1 April 2023
to 2 September 2023) except as mentioned below -
1. With reference to DRHP submitted by the Company on 03 March
2023 the Company has issued a public announcement dated 18 May 2023 (the Public
Announcement) published on 19 May 2023 disclosing the inclusion of the Yeluri Family
Trust, as a Promoter of the Company instead of the Promoter Group and removing all
references to Aadhaar numbers of the Promoters, in the DRHP of the Company.
2. The Company received in-principle approval from National
Stock Exchange of India Limited and BSE Limited vide letter dated 31 May 2023 and 01 June
2023 respectively for the proposed Initial Public Offer (IPO) of the Company.
3. Company received approval from Securities Exchange Board of
India (SEBI) vide letter dated 26 June 2023 for the proposed Initial Public
Offer (IPO) of the Company.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Management Discussion and Analysis Report, as required under
Regulation 34 & Schedule V of Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015 is provided as Annexure
V, and forms parts of this report.
CORPORATE GOVERNANCE REPORT
Report on Corporate Governance is provided as Annexure VI,
and forms part of this report.
M/s NSVR & Associates LLP, Chartered Accountants (Firm Registration
No. 008801S/S200060), Statutory Auditors of the Company have certified the said report in
compliance with the requirements of Regulation 34 of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations 2015 and the Compliance Certificate forms part of the
Corporate Governance Report provided as Annexure VII.
ANNUAL RETURN
Annual Return pursuant to Section 134(3)(a) and Section 92(3) of the
Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration)
Rules, 2014, the copy of Annual Return for the year 2022-23, will be available on the
website of the Company at www.novaagri.in.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS OR
TRIBUNALS
During the year under review, no significant and material orders passed
by regulators or courts or tribunals impacting the going concern status and company
operations in future.
RISK MANAGEMENT FRAMEWORK
Risk management is the process of identification, assessment and
prioritization of risks, followed by coordinated efforts to minimize, monitor and
mitigate/ control the probability and/or impact of unfortunate events to maximize the
realization of opportunities. The Board oversees Company's processes for determining
risk tolerance and review management's action and comparison of overall risk
tolerance to established levels. Major risks identified by the businesses and functions
are systematically addressed through appropriate actions on a continuous basis.
The Company has a robust internal business management framework to
identify, evaluate business risks and opportunities which seeks to minimize adverse impact
on the business objectives and enhance the Company's business prospects. The Company
has an Internal Control System, commensurate with the size and scale of its operations.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and
foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies
Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014.
Conservation of energy:
The operations of the Company are not energy-intensive. However, The
Company is making continuous efforts on ongoing basis to conserve the energy by adopting
innovative measures to reduce wastage and optimize consumption.
(i) |
The steps taken or impact
on conservation of energy |
The operations of the
company are not energy intensive, adequate measures have, however, been taken, to |
(ii) |
The steps taken by the
company for utilizing alternate sources of energy |
conserve and reduce
wastage and optimize consumption. |
(iii) |
The Capital investment on
energy conservation equipment's |
Nil |
Technology Absorption:
We firmly believe that technology is the genesis of innovative business
practices, which in turn enable the organization to carry out business effectively and
efficiently. We intend to make investments in innovative techniques for this regard.
Foreign Exchange Earnings & Outgo:
Foreign Exchange earnings |
: |
Nil |
Foreign Exchange outgo |
: |
Nil |
Proceedings under IBC
As per the requirements of Rule 8(5)(xi) and (xii) of the Companies
(Accounts) Rules, 2014
No application made or proceeding pending against your Company under
the Insolvency and Bankruptcy Code, 2016. No one-time settlement of financial dues was
made during the period under review.
Information to be furnished under Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014
Information required pursuant to Section 197(12) of the Act read with
Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, is not applicable for the FY 2022-23 as the Company is yet to be listed. However, no
Employee is in receipt of the remuneration as specified in Rule 5(2) of above stated rule.
Disclosures, as required under Para A of Schedule V of SEBI (Listing
Obligations and Disclosure) Requirements) Regulations, 2015
Transactions, with person(s) or entity(ies) belonging to the Promoter /
Promoter Group which hold(s) 10% or more shareholding in the Company, as per Schedule V
(2A) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, during
the period under review has been provided in notes to the financial statements.
INSIDER TRADING REGULATIONS
Based on the requirements of SEBI (Prohibition of Insider Trading)
Regulations, 2015, as amended from time to time, the code of conduct for the Prohibition
of Insider Trading, as approved by the Board is implemented by the Company. The Company,
also, adopts the concept of trading window closure, to prevent its Directors, Officers,
Designated Employees, their relatives from trading in the securities of the Company at the
time when there is unpublished price sensitive information.
The Board has appointed Ms. Neha Soni, Company Secretary, as the
Compliance Officer.
In view of proposed listing, the Company is also in process to
implement the Structured Digital Database (SDD) facility as prescribed under SEBI
(Prohibition of Insider Trading) Regulations, 2015.
DISCLOSURES WITH RESPECT TO THE DEMAT SUSPENSE ACCOUNT/UNCLAIMED
SUSPENSE ACCOUNT
Not Applicable, as the Company do not have any shares in the demat
suspense account or unclaimed suspense account.
DISCLOSURES OF CERTAIN TYPES OF AGREEMENTS BINDING LISTED ENTITIES
There is no such agreement(s) binding the Company.
SECRETARIAL STANDARDS
Your Company is in compliance with the Secretarial Standards on
Meetings of the Board of Directors (SS - 1) and General Meetings (SS - 2) issued by The
Institute of Company Secretaries of India and approved by the central government.
INDUSTRIAL RELATIONS
Your Directors are happy to report that the industrial relations have
been cordial at all levels throughout the year. Your Directors record their appreciation
for all the efforts, support, and cooperation of all employees being extended from time to
time.
HUMAN RESOURCES
Your Company considers its human resources as the key to achieve its
objectives. Keeping this in view, your Company takes utmost care to attract and retain
quality employees. The human resources systems procedures and the organizational
environment are all designed to nurture creativity, innovation and greater efficiencies in
its human capital. Training is an integral element of the HR system. The employees are
sufficiently empowered, and such work environment propels them to achieve higher levels of
performance.
The unflinching commitment of the employees is the driving force behind
the Company's vision. Your Company appreciates the spirit of its dedicated employees.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with
the requirements of The Sexual Harassment of Women at the Workplace (Prevention,
Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set
up to redress complaints received regarding sexual harassment. All employees (permanent,
contractual, temporary, trainees) are covered under this policy.
Summary of harassment complaints:
No. of complaints received |
: Nil |
No. of complaints disposed off |
: Nil |
OTHER DISCLOSURES
During the year under review
Your Company has not revised financial statement(s).
your Company achieved some of the major events and milestones in the
history of our Company as listed below:
1) Introduced fertilizer and pesticide spraying drones
"Nova Agribot" and soil health scanning device "Bhu-Parikshak" to
market.
2) Introduced beneficial element fertilizers
"HY-Clean" in the market.
3) Ten (10) acres of land allotted by Karnataka Industrial Areas
Development Board (KIADB) for manufacture of Agro Chemical, Pesticides, Bio
Stimulants, Micro Nutrients, Water Solubles in the State of Karnataka.
4) Expanded our business by appointing C&F agents in the
States of Gujrat, Jammu & Kashmir, Tamil Nadu, Uttarakhand, Uttar Pradesh and West
Bengal.
AWARDS & RECOGNITION:
During the period under review, some of the awards, accreditation or
recognitions received by the Company are listed below:
Awarded with "Best Company of The Year- Soil Health
Management" by Agri Awards-2022. Awarded with HR Best Practices for 2022
in the category of Talent Acquisition and Management (Medium Scale Industry) by the
Federation of Telangana Chambers of Commerce and Industry. Joined as a member or
"IMMA-Indian Micronutrient Fertilizers Manufacturers Association. Awarded as the
Leader with Strategic Vision-Business Transformation' by Agri Business Summit
& Awards ABSA, 2022.
APPRECIATION:
The Directors express their appreciation to all employees of the
various divisions for their diligence and contribution to performance. The Directors also
record their appreciation for the support and cooperation received from bankers and all
other stakeholders Last but not the least, the Directors wish to thank all shareholders
for their continued support.
By the Order of the Board
FOR NOVA AGRITECH LIMITED Place: Singannaguda Date: 02 September 2023
Sd/- |
Sd/- |
SREEKANTH YENIGALLA |
KIRAN KUMAR ATUKURI |
WHOLE-TIME-DIRECTOR |
MANAGING DIRECTOR |
DIN: 07228577 |
DIN: 08143781 |