for the financial year ended March 31, 2023 Dear Members,
Your Board of Directors ("Board") is pleased to present the 34th
Annual Report of Advanced Enzyme Technologies Limited ("Company") along with the
Audited financial statements for the financial year ended March 31, 2023.
FINANCIAL HIGHLIGHTS
The financial performance of your Company for the financial year ended March 31, 2023
is summarized below:
(Rs. in million)
|
Standalone |
Consolidated |
| Particulars |
Year ended March 31, 2023 |
Year ended March 31, 2022 |
Year ended March 31, 2023 |
Year ended March 31, 2022 |
| Revenue from operations |
3,115 |
2,728 |
5,406 |
5,294 |
| EBITDA |
749 |
727 |
1,564 |
2,014 |
| Less: |
|
|
|
|
| Finance Cost |
1 |
1 |
24 |
18 |
| Depreciation and Amortisation |
103 |
96 |
350 |
349 |
| Add: |
|
|
|
|
| Other income |
98 |
91 |
255 |
64 |
| Profit before exceptional items and tax |
743 |
721 |
1,445 |
1,711 |
| Exceptional items |
- |
- |
41 |
- |
| Profit Before Tax |
743 |
721 |
1,404 |
1,711 |
| Less: Provision for Taxation |
|
|
|
|
| Current tax |
183 |
180 |
428 |
504 |
| Deferred tax |
5 |
(5) |
(63) |
(31) |
| MAT credit entitlement |
- |
- |
- |
- |
| Tax adjustment for earlier years |
- |
- |
- |
- |
| Tax expenses |
188 |
176 |
365 |
473 |
| Profit for the year |
555 |
545 |
1,039 |
1,238 |
| Surplus Brought Forward from Previous Year |
3,827 |
3,349 |
9,173 |
7,977 |
| Amount Available for Appropriations |
4,175 |
3,827 |
10,023 |
9,174 |
| Earnings Per Share (Amount in Rs.) |
|
|
|
|
| Basic |
4.97 |
4.88 |
9.45 |
10.70 |
| Diluted |
4.97 |
4.87 |
9.45 |
10.68 |
RESULTS FROM OPERATIONS Revenue - Consolidated
Your Company's revenue from operations on consolidated basis increased to Rs. 5,406
million in the financial year 202223 ("FY23") from Rs. 5,294 million in the
financial year 2021-22 ("FY22"), a growth rate of 2%. The total revenue
comprises of international sales amounting to Rs. 2,850 million (FY22 - Rs. 2,951
million), fall of 4% and domestic sales amounting to Rs. 2,557 million (including Export
Incentives of Rs. 3 million) (FY22 - Rs. 2,342 million (including Export Incentives of Rs.
5 million)), an increase of 9%.
Your Company's domestic sales constitute about 47% of revenue from operations during
FY23 as compared to 44% of revenue from operations during FY22. International sales were
53% of revenue from operations as compared to 56% of revenue from operations during FY22.
Revenue - Standalone
Your Company's revenue from operations on standalone basis increased to Rs. 3,115
million in FY23 from Rs. 2,728 million in FY22, at an increase of 14%. The total revenue
comprises international sales of Rs. 975 million (FY22 - Rs. 782 million), an increase of
25% and Domestic sales at Rs. 2,140 million (including Export Incentives of Rs. 2 million)
(FY22 - Rs. 1,946 million (including Export Incentives of Rs. 4 million)), an increase of
10%.
The domestic sales constitute 69% of revenue from operations during FY23 as compared to
71% of revenue from operations during FY22. International sales were 31% of revenue from
operations during FY23 as compared to 29% of revenue from operations during FY22.
Profits - Consolidated
EBITDA (Earnings before interest, tax, depreciation & amortisation excluding other
income) during FY23 was
Rs. 1,564 million (29%) as compared to Rs. 2,014 million (38%) during FY22, a decrease
of 22%.
Profit before tax stood at Rs. 1,404 million (26%) during FY23 as against Rs. 1,711
million (32%) in the previous year, a decline of 18%. Profit after tax stood at Rs. 1,039
million during FY23 as compared to Rs. 1,238 million during the FY22, decline of 16%.
Profits - Standalone
EBITDA during the year under review was at Rs. 749 Million (24%) as compared to Rs. 727
million (27%) in the FY22. Profit before tax stood at Rs. 743 Million during FY23 as
compared to Rs. 721 million in the FY22, an increase of 3%. Profit after tax stood at Rs.
555 million during FY23 as compared to Rs. 545 million during FY22, an increase of 2%.
DIVIDEND
Pursuant to the Dividend Distribution Policy of the Company, the Board recommends a
final Dividend @ 50% i.e. Rs. 1/- per Equity Share of face value of Rs. 2/- each for the
financial year
2022- 23 ("FY23"), aggregating to about Rs. 111.82 million (subject to
deduction of taxes, as applicable) i.e. same rate of final dividend as in the previous
financial year 2021-22 ("FY22"). Further, the Board of Directors of your Company
had also declared an Interim Dividend @ 200% i.e. Rs. 4/- per Equity Share of face value
of Rs. 2/- each for the financial year
2023- 24 ("FY24"), aggregating to about Rs. 447.30 million (subject to
deduction of taxes, as applicable).
The Dividend Distribution Policy of the Company is provided as Annexure I and forms an
integral part of this Report and the said policy is available on the Company's website at
www.advancedenzymes.com/investors/corporate- governance/#codes-and-policies.
The final Dividend payout is subject to approval of the Members at 34th
Annual General Meeting ("AGM") of your Company.
The Dividend Distribution Tax payable by domestic companies on declaration of dividend
has been abolished w.e.f. April 01, 2020. Pursuant to this amendment and consequential
amendments brought vide Finance Act, 2020, as the dividend by the companies is taxable in
the hands of the shareholders, the Company would be under an obligation to deduct tax at
source ("TDS") in accordance with the provisions of the Income Tax Act, 1961 (as
amended from time to time).
RESERVES
During the FY23, your Company has not transferred any amount to the General Reserves.
EMPLOYEES STOCK OPTION PLAN
The disclosure pertaining to the details of Employees Stock Option Scheme 2015 [as
amended] ("ESOP Scheme 2015"), Employees Incentive Plan 2017 ("Plan
2017") and Employees Stock Option Scheme 2022 ("ESOP 2022") are
provided in Annexure II and forms part of this Report. The said disclosure is displayed on
the website of the Company under the tab ‘Details of Employees Stock Option' at www.
advancedenzymes.com/investors/shareholder-information ESOP 2015
The Nomination & Remuneration Committee in its meeting held on February 14, 2017
granted 220,000 stock options of Rs. 2/- each to its eligible employees of the Company and
the employees of subsidiaries ("Grantee"). As per the provisions of ESOP
Scheme 2015, the stock options granted under the said scheme for the eligible
employees/Grantees vested as follows:
(i) First tranche of 10% of stock options got vested on February 15, 2018;
(ii) Second tranche of 20% on February 15, 2019;
(iii) Third tranche of 30% on February 15, 2020, and
(iv) Fourth and last tranche of 40% on February 15, 2021. Each Option is convertible
and is equivalent to One (1) Equity Share. Based on the exercise applications received,
the Board / Committee allotted 23,400 Equity Shares of Rs. 2/- each (at an exercise price
of Rs. 60/- each) during the year under review, under ESOP Scheme 2015 as follows:
| Sr. No. |
Date of Meeting (Allotment Date) |
No. of shares allotted |
| 1. |
May 22, 2022 |
5,900 |
| 2. |
July 21, 2022 |
11,250 |
| 3. |
September 30, 2022 |
4,250 |
| 4. |
February 11, 2023 |
2,000 |
| Total |
o o
<3
00
CM |
|
In view of above, the Paid-up share capital of your Company has increased as follows
(as on March 31, 2023):
| Particulars |
Paid-up Capital |
| No. of shares |
Amount (Rs.) |
| At the beginning of the year |
111,800,675 |
223,601,350 |
| Allotments during the year |
23,400 |
46,800 |
| At the end of the year |
111,824,075 |
223,648,150 |
Based on the exercise applications of the Grantees and amount received thereto, total
23,400 Equity Shares of Rs. 2/- each were allotted to such Grantees by the Board during
FY23 and accordingly the paid up share capital of the Company has increased from Rs.
223,601,350 to Rs. 223,648,150.
The Equity Shares allotted under ESOP Scheme 2015 are subject to lock in for a period
of 1 year from the date of allotment.
During the year under review, the Board of your Company decided that there shall be no
further grant under the ESOP Scheme 2015 and the Options that are already granted/ vested
but not exercised shall continue till the time they are either lapsed or exercised, as per
terms of the grant/ provisions of the ESOP Scheme 2015. Thereafter, the ESOP Scheme 2015
shall be deemed cancelled/terminated. As all the Options granted have either been allotted
or lapsed, the ESOP Scheme 2015 stands terminated.
Employees Incentive Plan 2017
The Members of the Company have also approved the AETL Employees Incentive Plan 2017
("Plan 2017") through trust route and related matters on May 04, 2017
through Postal Ballot. Your Company has received in-principle approval from BSE Limited
(BSE) and National Stock Exchange of India Limited (NSE). As on the date of this report,
no Stock Options / Stock Appreciation Rights have been granted under the Plan 2017.
No grant of options has been made under the Plan 2017. The Board of Directors in its
meeting held during the year under review, cancelled/terminated the Plan 2017.
ESOP 2022
The Members of the Company have approved the AETL Employee Stock Option Scheme 2022'
("ESOP 2022") and related matters on August 19, 2022 at the 33rd
Annual General Meeting of the Company. Your Company has received in-principle approval
from BSE Limited (BSE) and National Stock Exchange of India Limited (NSE). As on the date
of this report, no Stock Options have been granted under the ESOP 2022.
FINANCIAL STATEMENTS
The financial statements of your Company for the year ended March 31, 2023 are prepared
in accordance with the Indian Accounting Standards ("IND AS"), read with
the provisions of Section 129 and other applicable provisions, if any, of the Companies
Act, 2013 ("the Act") rules framed thereunder and Regulation 33 of the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (including any statutory modification(s) or re-enactments thereof for
the time being in force) ["SEBI Listing Regulations"] and forms part of
this Annual Report. The estimates and judgments relating to the financial statements are
made on a prudent basis, so as to reflect in a true and fair manner, the form and
substance of transactions and reasonably present the Company's state of affairs, profits
and cash flows for the year ended March 31, 2023.
SUBSIDIARIES
Your Company has twelve (12) subsidiaries as listed below: Domestic Subsidiaries:
1. Advanced Bio-Agro Tech Limited (60%) ["ABAT "];
2. Advanced EnzyTech Solutions Limited (100%) ["AESL"];
3. JC Biotech Private Limited (89.83%) ["JCB"];
4. SciTech Specialities Private Limited (51%) ["SciTech"]
5. Saiganesh Enzytech Solutions Private Limited (50%, effective from January 03, 2023)
["Saiganesh"]
In terms of the financial performances:
i. ABAT's revenue for FY23 was Rs. 472 million (previous financial year
["FY22"] - Rs. 404 million), and Profit after Tax for FY23 was Rs. 60 million
(FY22 - Rs. 66 million).
ii. AESL's revenue for FY23 was Rs. 134 million (FY22 - Rs. 119 million), and Profit
after Tax for FY23 was Rs. 18 million (FY22 - Rs. 18 million).
iii. JCB's revenue for FY23 was Rs. 502 million (FY22 - Rs. 503 million), and
Profit/(loss) after Tax for FY23 was Rs. (18) million (FY22 - Rs. 72 million).
iv. SciTech's revenue for FY23 was Rs. 353 million (FY22 - Rs. 473 million), and
Profit/(loss) after Tax for FY23 was Rs. (62) million (FY22 - Rs. 37 million).
v. Saignesh's revenue for FY23 was Rs. 26 million (FY22 - Rs. 84 million), and Profit
after Tax for FY23 was Rs. 2 million (FY22 - Rs. 4.68 million). Saiganesh became
subsidiary of the Company effective from January 03, 2023.
International Subsidiaries:
1. Advanced Enzymes USA (100%)
A. Advanced Supplementary Technologies Corporation (100% Subsidiary of Advanced Enzymes
USA);*
B. Cal-India Foods International (doing Business as Specialty Enzymes and
Biotechnologies) (100% Subsidiary of Advanced Enzymes USA);
C. Enzyme Innovation Inc. (100% Subsidiary of Cal- India Foods International);
*Note: During the financial year 2022-23, the Board of Directors of respective wholly
owned subsidiaries i.e. Dynamic Enzymes, Inc., USA ("DE") and Advanced
Supplementary Technologies Corporation, USA ("AST") approved merger of DE and
AST. Further, the State of California (USA) had approved the merger of DE into AST and
consequently thereafter, DE merged into AST, and DE ceases to exist.
In terms of the consolidated financial performance of Advanced Enzymes USA, the revenue
for FY23 was Rs. 1,933 million (FY22 - Rs. 2,140 million), and Profit after Tax for FY23
was Rs. 583 million (FY22 - Rs. 647 million).
2. Advanced Enzymes (Malaysia) Sdn. Bhd. (100%) ["AEM"] The Company
acquired AEM in the year 2017 (incorporated in 2016). During FY20, the Board of your
Company approved the discontinuation of the business and closure of AEM and to initiate
the process of closure thereto, since AEM was not giving the desired results. During FY23,
no business activities were carried out resulting into Nil profit in the year whereas
During FY22, the assets which were no longer receivable were written-off and the
liabilities which were no longer payable were written-back resulting in a (loss) about Rs.
(0.60) million). AEM is currently under the process of voluntary Strike-off.
3. Advanced Enzymes Europe B.V (100%) ["AEE"]
In terms of the consolidated financial performance (including its subsidiary, evoxx
technologies, GmbH), AEE's revenue for FY23 was Rs. 240 million (FY22 - Rs. 220 million),
and Profit / (loss) for FY23 was Rs. (39) million (which includes about Rs. 58 million of
operational gain, Rs. 7 million of other income, Rs. 9 million of deferred tax reversal,
Rs. 63 million of amortization expense, and Rs. 51 million of finance cost) as compared to
loss of Rs. 103 million for FY22.
4. evoxx technologies GmbH [100% subsidiary of AEE] [evoxx]
For FY23, the revenues for evoxx was Rs. 240 million (FY22 - Rs. 220 million) and had a
positive impact on the bottom line by Rs. 18 million including operational gain of Rs. 36
million (FY22 - Rs 6 million operational loss) and charge of Rs. 12 million (FY22 - Rs. 14
million) of an amortization expense and finance cost of Rs. 9 million (FY22 - Rs. 9
million).
The Policy for determining Material Subsidiaries is available on the Company's website:
www.advancedenzymes.com/ investors/corporate-governance. During the year under review,
Cal-India Foods International in USA was Material Subsidiary of your Company based on the
criteria specified in the SEBI Listing Regulations.
A separate statement containing the salient features of the financial performance of
subsidiaries in the prescribed Form AOC-1 is annexed to the financial statements of the
Company. The Audited Consolidated financial statements together with Auditors' Report form
an integral part of the Annual Report.
The individual financial statements and other reports of the Company's subsidiaries
have not been attached to the financial statements of the Company for FY23. Pursuant to
the provisions of Section 136 of the Act read with the SEBI Listing Regulations, the
financial statements of the subsidiaries and related information
are uploaded on the website of your Company and can be accessed on the web link,
www.advancedenzymes. com/investors/quarterly-updates/financial-results and also available
for inspection, during working hours at the registered office of the Company on working
days except Saturdays and Sundays, up to the date of 34th AGM of the Company.
Any Member desirous of conducting inspection and/or of seeking information on the Annual
financial statements of the Company's subsidiaries may write and intimate in advance, to
the Company Secretary.
SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE
COMPANIES
A. During the year under review, the Board of your Company, at its meeting held on
November 11, 2022, approved the following (brief of approval with update is as follows):
(i) Acquisition of an additional stake of 4.83% (i.e. 1,000,000 Equity Shares) from an
existing shareholder of JC Biotech Private Limited ("JCB"), at a consideration
of Rs. 68 million. The said acquisition by increase in stake in JCB was completed on
January 03, 2023 and the stake of your Company in JCB has increased from existing 85% to
89.83%.
(ii) Acquisition of 50% (i.e. 19,991,663 Equity Shares) stake in Saiganesh Enzytech
Solutions Private Limited ("Saiganesh"), by way of subscription to the fresh
issue under Private Placement, at a consideration of Rs. 60 million. Saiganesh is
primarily into extracting Latex from papaya, purifying and providing finish papain enzyme
in liquid form (agriculture extraction of Papain enzyme). The Company has also entered
into Share Subscription and Shareholders' Agreement with Saiganesh. The said acquisition
of 50% stake in Saiganesh was completed on January 03, 2023.
(iii) Conversion of loan/Inter Corporate deposits granted by your Company to Advanced
Enzymes Europe B.V, Netherlands (wholly owned subsidiary) ("AEE") in to the
Equity Shares of AEE to the extent of total outstanding principal and interest accrued on
the mutually agreed date of conversion, in one or more tranches. On April 7, 2023,
consequent to conversion of the aforesaid loan, AEE issued 2,276,837 Equity shares of a
par value of EUR 1 each at a share premium of EUR 0.63 each, to your Company against
outstanding loan amount including interest aggregating to EUR 3,711,244.60. AEE continues
to be the wholly-owned subsidiary of your Company and there is no change in the Percentage
shareholding (100%) of your Company in AEE post conversion of loan given by your
Company to AEE.
B. During the Financial year 2022-23, the Board of Directors of Saignesh Enzytech
Solutions Private Limited (50% Subsidiary) ["Saiganesh"] approved the purchase
of entire business undertaking of Shri Ganesh Industrial Enzymes (a partnership firm based
in Burhanpur, Madhya Pradesh) ("Shri Ganesh"), through a slump sale on a going
concern basis for an amount not exceeding Rs. 9 million, for the purpose of Market
expansion & growth for products of Saiganesh. Shri Ganesh is involved in the business
of processing Latex from papaya, purifying and providing finish papain enzyme in liquid
form (agriculture extraction of Papain enzyme) i.e. same business activity as that of
Saiganesh (Health care industry). The total turnover and net-worth of the Shri Ganesh for
financial year 2021-22 was Rs. 57.6 Million and Rs. 10.3 million respectively. Saiganesh
is in the process of completing the said purchase by way of slump sale.
C. During the Financial year 2022-23, the Board Directors of respective wholly owned
subsidiaries i.e. Dynamic Enzymes, Inc., USA ("DE") and Advanced Supplementary
Technologies Corporation, USA ("AST") approved the merger of DE and AST.
Further, the State of California (USA) approved the merger of DE into AST. Pursuant to the
above, DE merged with and into AST and consequently thereafter DE ceases to exist.
The details are available on the website of the Company at
www.advancedenzymes.com/investors/ announcements-notices
Except as mentioned above, no other Company has become or ceased to be a Subsidiary,
Joint Venture or Associate of the Company during the year under review.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed review of the operations, performance and future outlook of your Company,
Subsidiaries and its Business including Risks, Opportunities and Threats are given in the
Management Discussion and Analysis, as required under the SEBI Listing Regulations, which
is provided in separate section and forms an integral part of this Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 of the Companies Act, 2013, the Directors, to
the best of their knowledge and belief and based on the information and explanations
provided to them, confirm that:
a. in the preparation of the annual accounts for the year ended March 31, 2023, the
applicable accounting standards read with requirements set out under
Schedule III to the Act, have been followed and there are no material departures from
the same;
b. appropriate accounting policies have been selected and applied consistently and
judgments and estimates are made reasonably and prudently so as to give a true and fair
view of the state of affairs of the Company as at March 31, 2023 and of the profit of the
Company for the year ended on that date;
c. Proper and sufficient care has been taken for the maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding the assets of the
Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts have been prepared on a 'going concern' basis;
e. Proper internal financial controls are devised to ensure compliance with all the
provisions of the applicable laws and that such internal financial controls are adequate
and are operating effectively; and
f. Proper systems are devised to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
RISK MANAGEMENT
Your Company understands that controlling risks through a formal program is a necessary
component and an integral cornerstone of Corporate Governance. Your Company has adopted
Risk Assessment & Management policy which embeds the vision that a robust Risk
Management system ensures commensurate controls and monitoring mechanism for smooth and
efficient management of Business. The Policy outlines the framework for identification,
measurement, evaluation, monitoring and mitigation of various risks. The Management has
also reviewed the Risk Management framework of the Company. The Risk Registers are
prepared by the concerned departments wherein the respective risks are identified along
with its current control activities and the mitigation plans. Thereafter, the registers
are reviewed.
The Risk Management Committee constituted by the Board assists the Board in monitoring
and review of Risk Management Policy of the Company including associated systems,
processes, controls & strategies thereto, various risks exposures of the Company, on a
periodic basis and then inform the Board about the risks assessed, their concerns and
action plan with strategy for mitigation of the risks and such other functions related to
risk management & mitigation as may be required by the Board, from time to time.
RELATED PARTY TRANSACTIONS
During the year under review, all transactions with the Related Parties were placed
before the Audit Committee for its approval. An omnibus approval from the Audit Committee
was obtained for the Related Party transactions which are repetitive in nature. The Audit
Committee and the Board, reviewed all the transactions entered into pursuant to the
omnibus approvals on a quarterly basis. All the transactions with Related Parties, entered
into during the year under review, were in the ordinary course of business and on arms'
length basis in accordance with the provisions of the Act, Rules made thereunder and the
SEBI Listing Regulations. Approval of the Members of the Company is also obtained in case
any Related Party transaction exceeds the prescribed limits and as good corporate
governance practice as there may be few transactions that may be carried out in the
long-term interest of the Company. The transactions of the Company with its wholly-owned
subsidiaries are exempted from approval of the Members, and hence such approvals are not
obtained by the Company.
The Policy on Related Party Transactions (as amended) is available on the Company's
website and can be accessed at www.advancedenzymes.com/investors/corporate- governance
As prescribed under Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of
the Companies (Account) Rules, 2014, particulars of contracts/arrangements with Related
Parties are given in Form AOC-2, annexed as Annexure III to this Report.
TRANSFER TO INVESTOR EDUCATION AND
PROTECTION FUND (IEPF)
Pursuant to Section 124(6) of the Companies Act, 2013, all shares in respect of which
Dividend has not been paid or claimed for seven consecutive years or more shall be
transferred by the company in the name of Investor Education and Protection Fund ("IEPF").
In view of this, your Company has transferred 4,000 unclaimed Equity Shares pertaining to
financial year 2014-15 to the Demat account of IEPF during October, 2022. The details of
the said shares are provided on the website of the Company at www.advancedenzymes.
com/investors/shareholder-information During the year under review, the Company has
transferred unclaimed Dividend of Rs. 69,710 for the financial year 201415. As on March
31, 2023, the total amount lying in the Unpaid Dividend accounts of the Company in respect
of the last seven years is around '11,66,139. Details of unclaimed Dividend and Shares due
for transfer with due dates and procedure to claim the same are provided in the Notes to
the Notice convening 34th AGM of the Company ("AGM
Notice" / "Notice of 34th AGM") and briefly in the Corporate
Governance Report which forms an integral part of this Report.
Details of Nodal Officer are displayed on the Company's website at:
www.advancedenzymes.com/investors/shareholder-
information
CORPORATE SOCIAL RESPONSIBILITY ("CSR")
The Annual Report on Corporate Social Responsibility activities has been provided in
Annexure IV and the report along with all the details thereto, forms an integral part of
this Report. The Composition of CSR Committee is disclosed in the said Annual Report on
CSR Activities and in the Corporate Governance report section.
The Corporate Social Responsibility Policy, as amended, may be accessed on the
Company's website at www. advancedenzymes.com/investors/corporate-governance.
POLICY ON CRITERIA FOR APPOINTMENT / REMOVAL OF DIRECTORS AND SENIOR MANAGEMENT
PERSONNEL AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND EMPLOYEES
As per the Nomination & Remuneration Policy of the Company ("Policy"),
the Nomination and Remuneration Committee inter alia recommends the appointment of
Directors, Key Managerial Personnel (KMP) and Senior Management Personnel. The Policy lays
down the criteria for such appointments and the framework in relation to remuneration of
Directors including Managerial Personnel, KMPs and employees of the Company. The
Nomination & Remuneration Committee oversees the matter of remuneration to the
Executive Directors, KMPs and Senior Management Personnel and recommends to the Board,
revision, if any, in the remuneration of the said Directors / Personnel subject to limits
as may be approved by the Members.
The Nomination and Remuneration Policy may be accessed on the Company's website at
www.advancedenzymes.com/ investors/corporate-governance.
The Board of your Company affirms that the remuneration paid to the Directors is as per
the terms laid out in the Nomination and Remuneration Policy of the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review, the following changes occurred in the composition of the
Board and the Key Managerial Personnel of your Company:
(i) The Board of your Company approved the appointment of Mr. Nitin Jagannath Deshmukh
(DIN: 00060743) as an Additional Director (Independent) with effect from
July 01, 2022 and the Members of the Company in the 33rd AGM of the Company
held on August 19, 2022 approved his appointment as an Independent Director of the Company
for a period of five years effective from July 01, 2022.
(ii) The Board of your Company in its meeting held on May 13, 2023, based on the
recommendation of the Nomination and Remuneration Committee:
a) Approved the appointment of Ms. Vandana R. Tilak (DIN: 10048021) as an Additional
Director (Independent) with effect from July 01, 2023 to hold office up to the date of
this AGM or the date up to which AGM shall be held whichever is earlier. She is not
related to any of Directors of the Company. The Board recommends the appointment of Ms.
Vandana R. Tilak as an Independent Director, not liable to retire by rotation, for a
period of five (5) years effective from July 01, 2023 and her brief profile is provided in
the Notice convening the said 34th AGM of the Company ("AGM Notice").
b) Approved the re-appointment of Mr. Vinodkumar Hiralal Jajoo (DIN: 08224980) as an
Independent Director for second term with effect from February 09, 2024 to hold office for
the term of five years up to the date February 08, 2029 subject to approval of
shareholders at the 34th AGM of the Company. He is not related to any of
Directors of the Company. The Board recommends the appointment of Mr. Vinodkumar Hiralal
Jajoo as an Independent Director, not liable to retire by rotation, for the said period of
five (5) years effective from February 09, 2024 and his brief profile is provided in the
Notice convening the said 34th AGM of the Company ("AGM Notice").
c) Approved the re-appointment of Ms. Rajshree Patel (DIN: 08761022) as an Independent
Director for second term of three years with effect from June 12, 2023 to June 11, 2026
subject to approval of shareholders at the 34th AGM of the Company. She is not
related to any of Directors of the Company. The Board recommends the re-appointment of Ms.
Rajshree Patel as an Independent Director, not liable to retire by rotation, for the said
period of three (3) years effective from June 12, 2023 and her brief profile is provided
in the AGM Notice.
Except as mentioned above, there has been no change in the composition of Board and Key
Managerial Personnel of the Company, during the year under review.
DECLARATION BY THE INDEPENDENT DIRECTORS
All Independent Directors of the Company have given the following declarations stating
that:
(i) they meet the 'criteria of Independence' as defined under Regulation 16(1) of the
SEBI Listing Regulations and Section 149(6) of the Companies Act, 2013 read with Schedule
IV and the relevant Rules made thereunder;
(ii) they have complied with the provisions of the Code of Conduct & Ethics of the
Company. The Independent Directors have confirmed that they are not aware of any
circumstance or situation which exist or may be reasonably anticipated, that could impair
or impact their ability to discharge their duties with an objective independent judgment
and without any external influence.
(iii) they have complied with the provisions of Rule 6(1) and 6(2) of the Companies
(Appointment and Qualifications of Directors) Rules, 2014 (as amended) with regards to the
registration on the Independent Directors' databank.
None of the Directors of the Company are disqualified for being appointed as Directors
as specified in Section 164(2) of the Companies Act, 2013 and Rule 14(1) of the Companies
(Appointment and Qualification of Directors) Rules, 2014 (as amended).
The Board is of the opinion that the Independent Directors of the Company possess
requisite qualifications, experience and expertise and they hold highest standards of
integrity. The Independent Directors of your Company have registered on the Independent
Directors' Databank pursuant to the provisions of Section 149 of the Companies Act, 2013
and the applicable rules thereto ("Act"). The Independent Directors, as on March
31, 2023, have informed the Company, that they have either claimed exemption or passed the
online proficiency test prescribed under the Act.
RETIREMENT BY ROTATION
In accordance with the provisions of Section 152 of the Companies Act, 2013 read with
Rules made thereunder and the Articles of Association of the Company, Dr. Sunny Sharma
(DIN: 02267273), Non-Executive Director retires by rotation at the 34th AGM and
being eligible offers himself for re-appointment. The Board recommends the said
reappointment of Dr. Sunny Sharma at the 34th AGM and his brief profile is
provided in the Notice convening 34th AGM of the Company.
AUDITORS AND AUDITORS' REPORT STATUTORY AUDITORS
Pursuant to provisions of Section 139 of the Companies Act, 2013 read with the
Companies (Audit and Auditors) Rules, 2014 (as amended), M/s. MSKA & Associates,
Chartered Accountants [Firm's Registration No: 105047W] were appointed as Statutory
Auditors for a term of five consecutive years to hold office from the conclusion of 32nd
AGM up to the conclusion of the 37th AGM. The Auditors' Report to the
Members on the financial statements of the Company for the year ended March 31, 2023 forms
a part of the Annual Report and the Auditors' Report does not contain any qualification,
reservation or adverse remark.
COST RECORDS AND AUDIT
The Company has maintained Cost records in accordance with the provisions of Section
148(1) of the Companies Act, 2013, during the year under review. Based on the criteria
specified under the Act, the Cost Audit was not applicable for the financial year 2022-23.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made
thereunder, the Board has appointed Mr. Shiv Hari Jalan, Practicing Company Secretary (FCS
No. 5703, C.P. No. 4226) to undertake the Secretarial Audit of the Company. The
Secretarial Audit Report for the financial year 2022-23 is annexed as Annexure V and forms
an integral part of this Report. The Secretarial Audit Report for the year ended March 31,
2023 does not contain any qualification, reservation or adverse remark.
CORPORATE GOVERNANCE REPORT
The Report on Corporate Governance and the Certificate of the Practicing Company
Secretary regarding compliance of the conditions of Corporate Governance as required
pursuant to the provisions of the SEBI Listing Regulations, are enclosed as Annexure VI.
Declaration signed by the Whole-time Director affirming compliance with the Code of
Conduct by the members of the Board and Senior Management Personnel also forms part of
this Report.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORTING
Pursuant to the provisions of Regulation 34 of the SEBI Listing Regulations (as
amended), top one thousand listed entities based on market capitalization (calculated as
on March 31 of previous financial year) shall provide in its Annual Report, with effect
from the financial year 2022-23, the Business Responsibility and Sustainability Report
("BRSR Report") in the format as specified by the Securities and Exchange Board
of India, from time to time. In view of the said provision, the BRSR report for FY23 is
provided in a separate section of this Annual Report FY23 of your Company.
COMMITTEES OF THE BOARD
As per the Companies Act, 2013 and the SEBI Listing Regulations, during the year under
review, the Board has five statutory Committees viz., Audit Committee, Nomination and
Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders
Relationship Committee and the Risk Management Committee. The details of the composition
of these Committees along with number of meetings held and attendance at the meetings are
provided in the Corporate Governance Report, which forms an integral part of this Report.
VIGIL MECHANISM
Your Company had adopted Whistle Blower Policy / Vigil Mechanism Policy pursuant to the
provisions of Section 177(9) of the Companies Act, 2013 and the Companies (Meetings of
Board and Its Powers) Rules, 2014 and Regulation 22 of the SEBI Listing Regulations.
Details on the Vigil Mechanism of your Company have been outlined in Corporate Governance
Report, which forms an integral part of this Report.
The Whistle Blower Policy may be accessed on your Company's website at
www.advancedenzymes.com/ investors/corporate-governance
MEETINGS OF THE BOARD
During the year, 5 (five) meetings of the Board of Directors were held. The requisite
details of the Board Meetings and the details of the Directors present are provided in the
Corporate Governance Report, which forms part of this Report.
SECRETARIAL STANDARDS
During the year under review, the Company has complied with the provisions of
applicable Secretarial Standards issued by the Institute of Company Secretaries of India
with respect to the Board and General Meetings, as notified by the Ministry of Corporate
Affairs of India.
EVALUATION OF PERFORMANCE OF BOARD, ITS COMMITTEES AND DIRECTORS
Pursuant to the provisions of the Companies Act, 2013 and the SEBI Listing Regulations,
the Board has undertaken an Annual Evaluation of its own performance, its various
Committees and individual Directors. The manner in which the performance evaluation has
been carried out has been given in the Corporate Governance Report, annexed to this
Report. The Board expressed its satisfaction of the evaluation process and outcome.
The Board Evaluation policy can be accessed on your Company's website at
www.advancedenzymes.com/ investors/corporate-governance.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
Pursuant to provisions of Regulation 25(7) of the SEBI Listing Regulations, the details
of familiarization program is available on the website of your Company at www.
advancedenzymes.com/investors/corporate-governance. Further, upon appointment of an
Independent Director, the Company issues a letter of appointment outlining his / her role,
function, duties and responsibilities. The format of the letter of appointment is
available on the Company's website at: www.
advancedenzymes.com/investors/corporate-governance
CODE OF CONDUCT FOR PROHIBITION OF INSIDER TRADING
Your Company has in place a Code of Conduct for Prohibition of Insider Trading (known
as the AETL Insider Trading Code), which lays down the process for trading in securities
of the Company by the Designated Persons and to regulate, monitor and report trading by
the employees of the Company either on his/her own behalf or on behalf of any other
person, on the basis of Unpublished Price Sensitive Information.
The aforementioned Code, as amended, is available on the website of the Company at
www.advancedenzymes.com/ investors/corporate-governance
INTERNAL CONTROL AND ITS ADEQUACY
Your Company has adopted procedures and systems for ensuring the orderly and efficient
conduct of its Business, including adherence to the Company's policies, safeguarding of
its assets, the prevention and detection of frauds and errors, the accuracy and
completeness of the accounting records, and the timely preparation of financial
disclosures. Your Company maintains appropriate and adequate Internal Control System /
Internal Financial Control commensurate to its size and nature of operations. Your
Company's Internal Control systems are tested and certified by the Internal Auditors and
Statutory Auditors of the Company.
The Audit Committee periodically reviews the report(s) of the independent Internal
Auditors along with the adequacy and effectiveness of Internal Control systems.
SIGNIFICANT AND MATERIAL ORDERS
During the year under review, there were no significant and material orders passed by
the Regulators or Courts or Tribunals impacting the going concern status and its future
operations.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There was no change in Business and in the nature of Business of your Company during
the year under review affecting the financial position of the Company.
MATERIAL CHANGES FROM THE DATE OF END OF FINANCIAL YEAR TILL THE DATE OF THIS REPORT
Except as otherwise mentioned in this report, there are no material changes and
commitments affecting the financial position of the Company which have occurred between
the end of the Financial year of the Company to which the financial statements relates and
the date of this report.
PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED
The details of Loans and Investments under Section 186 of the Act read with the
Companies (Meetings of Board and its Powers) Rules, 2014 (as amended), for the FY23 are
given in the Standalone financial statements (Note No. 54 to the Standalone financial
statements). Your Company has not provided any guarantee or security under Section 186 of
the Act during the year under review.
ANNUAL RETURN
Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return of
the Company as on March 31, 2023 is available on the website of the Company at www.
advancedenzymes.com
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pertaining to conservation of energy, technology absorption, foreign
exchange earnings and outgo as required under Section 134 of the Act read with Rule 8(3)
of the Companies (Accounts) Rules, 2014 (as amended) is furnished in Annexure VII and
forms part of this Report.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Pursuant to Section 197(12) of the Act read with Rule 5 of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, as amended ("Rules"), the
details are disclosed in Annexure VIII to this report. In terms of Section 136(1) of the
Act read with second proviso to the Rule 5 of the said Rules, the Annual Report with
Annexure VIII is being sent to the Members excluding the statement of particulars of
employees under Rule 5(2) and (3) of the Rules ("Information"), which forms part
of this report. The Annexure VIII / Information under Rule 5(2) and (3) is available for
inspection by the Members at the registered office of the Company during business hours on
all working
days except Saturdays and Sundays up to the date of the AGM. Any Member interested in
conducting inspection and/ or obtaining a copy of the said Annexure/Information may write
to the Company Secretary at the Registered Office address of your Company.
DEPOSITS
During the year under review, your Company did not invite or accept any Deposits
covered under Chapter V of the Act. There were no outstanding deposits within the meaning
of Sections 73 and 74 of the Act, read together with the Companies (Acceptance of
Deposits) Rules, 2014 (as amended), at the end of the year under review or the previous
financial year.
CREDIT RATING
During the year under review, there is no change in the Credit Rating obtained by the
Company i.e. a long term rating of CRISIL A+/Stable (Reaffirmed) and a short term rating
of CRISIL A1 (Reaffirmed) for outstanding Bank loan facilities (outstanding facilities),
by Credit Rating Information Services of India Limited (CRISIL).
GENERAL DISCLOSURES
During the year under review:
a) The Whole-time Director of your Company has not received any remuneration or
commission from any of the subsidiaries.
b) Your Company has not issued Shares with Differential Rights as to Dividend, Voting
or otherwise.
c) Your Company has devised a policy on Prevention of Sexual Harassment to comply with
the provisions of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013. The said policy is hosted on the
Company's website at www.advancedenzymes.com. During the year under review, there were no
cases / grievances reported or pending and the Company has complied with provisions
relating to the constitution of Internal Complaints Committee under the Sexual Harassment
of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
d) There are no details to be disclosed under Section 134(3)(ca) of the Act as there
has been no such fraud reported by the Auditors under Section 143(12) of the Act.
e) There are no applications made by or any proceedings pending against the Company
under the Insolvency and Bankruptcy Code, 2016, during the year under review.
ACKNOWLEDGEMENTS
Your Directors acknowledge with gratitude the support received by the Company from the
Banks, Government agencies/ organizations and employees of your Company. Your Directors
also acknowledge with thanks the faith reposed by the Investors in the Company and look
forward to their continued support for times to come.
For and on behalf of the Board of Directors of Advanced Enzyme Technologies Limited
| Mukund Kabra |
Kedar Desai |
| Whole-time Director |
Director |
| DIN:00148294 |
DIN:00322581 |
| Place: Nashik |
Place: Mumbai |
| Date: May 13, 2023 |
|
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